EXHIBIT 10.3
#2785-002
AMENDMENT TO LOAN DOCUMENTS
---------------------------
AGREEMENT made as of June 30, 2004 ("AMENDMENT AGREEMENT" or
"AGREEMENT") by and between LYON FINANCIAL SERVICES, INC. DBA U.S. BANK
PORTFOLIO SERVICES, as Successor Servicer for DVI Receivables XVI, L.L.C. and as
Agent for U.S. Bank, N.A., as Trustee, with offices at 0000 Xxxxxx Xxxxxx, Xxxxx
000, Xxxxxxxx, Xxxxxxxxx 00000 ("USBPS") and Radnet Management I, Inc., a
corporation, with offices at 0000 Xxxxxx Xxxxxx, Xxx Xxxxxxx, XX 00000 ("RADNET
I"), and such other signatories hereto.
WHEREAS, on or about August 31, 2000, Radnet I executed and
delivered to DVI Financial Services Inc. ("DVI") a Master Loan Agreement
collectively with the Secured Promissory Note Number #2785-002 dated August 31,
2000 (the "LOAN");
WHEREAS, to secure the payment of the Loan and all other
obligations of Radnet I to DVI (collectively the "OBLIGATIONS"), Radnet I,
pursuant to a Master Security Agreement dated on or about August 31, 2000 (the
"SECURITY AGREEMENT"), granted DVI a first priority security interest in certain
Collateral described therein;
WHEREAS, to further secure payment of the Note and all other
Obligations of Radnet I to DVI, Radnet I delivered to DVI the guarantees (the
"GUARANTEES") of Primedex Health Systems, Inc. and Radnet Management, Inc. (each
a "GUARANTOR", and collectively the "GUARANTORS") (the Guarantees together with
the Loan and ancillary documents are, collectively, the "LOAN DOCUMENTS");
WHEREAS, substantially contemporaneously therewith, DVI
contributed all of the Loan Documents to DVI Receivables XVI, L.L.C. ("DVI XVI")
and thereafter pursuant to an Amended and Restated Indenture, DVI XVI granted a
first priority security interest in and pledged all of the Loan Documents in
favor of U.S. Bank, N.A., as Trustee, for the benefit of a
#2785-002
noteholder which purchased asset backed promissory notes issued by DVI XVI (the
"Noteholder");
WHEREAS, DVI contributed other Loans with Radnet I or certain
affiliates of Radnet I to this and other DVI securitizations (collectively the
"RELATED LOANS"); WHEREAS, Radnet I is in default under the terms of the Loan;
WHEREAS, Radnet I has requested USBPS to modify the Loan to
reflect an adjustment in payments;
WHEREAS, Radnet I and/or certain of its affiliates have agreed
to modify the Related Loans;
WHEREAS, Radnet I and certain of its affiliates are engaged in
negotiations to restructure or modify certain loan agreements, loans and
promissory notes with each of General Electric Capital Corporation ("GECC") and
DVI (with respect to GECC, the "GECC MODIFICATION", and with respect to DVI, the
"DVI MODIFICATION");
WHEREAS, subject to the following terms and conditions, USBPS
is willing to modify the Loan as hereinafter provided.
NOW, THEREFORE, the parties agree as follows:
1. All of the Whereas clauses are incorporated herein as if
hereinafter set forth at full length.
2. Radnet I acknowledges that it is duly indebted to the
Trustee in the sum set forth on AMENDED AND RESTATED RIDER A annexed hereto, and
has no defenses, counterclaims or offsets to such indebtedness.
3. USBPS as Agent for the Trustee will modify the Loan to
provide for payments to commence in accordance with the attached revised payment
schedule (the
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"AMENDED AND RESTATED RIDER A"). Radnet I may, at any time, prepay all of the
outstanding Obligations subject to an additional prepayment fee of 2% of such
Obligations. Partial prepayments of the Obligations shall not be permitted at
any time.
4. This Agreement shall become effective upon the date that
USBPS receives this Agreement duly executed by Radnet I and the satisfaction of
each of the following conditions:
(a) Radnet I and/or its affiliates shall have entered
into agreements on similar terms to this Agreement and
otherwise in form and substance satisfactory to USBPS,
relating to the Related Loans (the "Related Loan
Modifications");
(b) reimbursement of USBPS's legal fees incurred in
connection with the execution of this Agreement and the
Related Loan Modifications, aggregating $50,000, shall have
been received by USBPS;
(c) Radnet I and/or its affiliates shall have entered
into the GECC Modification and the DVI Modification.
5. The closing of the restructuring of the Radnet I Loan is
further subject to delivery to USBPS of all of the following, each in form and
substance satisfactory to USBPS and its counsel:
(a) The executed AMENDED AND RESTATED RIDER A;
(b) An executed copy of this Agreement;
(c) Such other documents, including UCC financing
statements as USBPS reasonably requests.
6. Radnet I hereby acknowledges and agrees that it has no, and
will not assert any, defenses, counterclaims or offsets to the Loan and AMENDED
AND RESTATED RIDER A and acknowledges and agrees that the Trustee holds a
first-priority security interest in the Collateral.
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7. Any default or other breach of any obligation under the
GECC Modification, the DVI Modification, or any of the Related Loan
Modifications shall constitute a default under the Loan as modified by this
Agreement, and USBPS shall have all remedies thereunder.
8. Radnet I hereby releases the Noteholder, USBPS individually
and as agent for the Trustee and the special purpose entities for which the
Trustee holds collateral, from and against any claims, loss or damage of any
kind or nature arising out of the Loan.
9. So long as any of the Obligations remain outstanding,
Radnet Management, Inc. (the "COMPANY") agrees as follows:
(i) FINANCIAL REPORTING. The Company shall furnish
the following documents or information to USBPS:
(A) Within 30 days after the end of each
Fiscal Quarter (as defined below) (i) (or 90 days in respect of the last month
of the fiscal year), the Company's consolidated, consolidating and on a center
by center basis, financial statements, including the most recent annual report,
balance sheet (not on a center by center basis) and income statement, prepared
in accordance with generally accepted accounting principles, which reports, the
Company warrants, shall fully and fairly represent the true financial condition
of the Company and (ii) updated projections for the Company and for each center;
(B) any other financial information normally
provided by the Company to the public; and
(C) Such other financial data or information
relative to this Amendment Agreement, including, without limitation, listings of
serial numbers or other identification data and confirmations of such
information, as USBPS may time-to-time reasonably request.
(ii) NO AMENDMENTS. Subsequent to the date of this
Amendment Agreement, the Company will not agree or consent to any amendments or
modifications to any agreement between the Company and DVI, GECC or Xxxxx Fargo
Foothill, Inc. ("FOOTHILL") containing terms (including, but not limited to,
increasing interest rates, accelerating the principal amortization or maturity,
new or more stringent defaults, additional collateral, and new remedies
provisions) that would be more onerous to the Company, or adversely impact or
affect GECC with respect to the terms of this Amendment Agreement.
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#2785-002
(iii) DISTRIBUTIONS. The Company shall not make any
distribution or declare or pay any dividends (in cash or other property, other
than common stock) on, or purchase, acquire, redeem, or retire any of the
Company's stock, of any class, whether now or hereafter outstanding
(collectively, "DISTRIBUTIONS"); PROVIDED, HOWEVER, that so long as no default
shall have occurred and be continuing immediately prior to or after giving
effect to any such payment, (a) the Company may make Distributions to Primedex
Health Systems, Inc., a New York corporation (the "PARENT") (1) in amounts
necessary to pay customary expenses of Parent in the ordinary course of its
business as a public holding company (including salaries and related reasonable
and customary expenses incurred by employees of Parent) in an aggregate amount
not to exceed $750,000 in any fiscal year, (2) in amounts necessary to enable
Parent to pay taxes when due and owing by it in the ordinary course of its
business as a holding company and (3) in amounts necessary to enable Parent to
pay interest on those certain 11.5% Series A Convertible Subordinated Notes due
June 30, 2008, issued by Parent on June 25, 1993, and (b) Parent may make
Distributions in the form of common stock.
(iv) FIXED CHARGE COVERAGE RATIO. Commencing April
30, 2005, the Company shall not permit the Fixed Charge Coverage Ratio, (a) to
be less than 1.0:1 as of the end of each April, July, October and January (each,
a "FISCAL QUARTER") ending prior to January 1, 2007, and (b) to be less than
1.05:1 as of the last day of each Fiscal Quarter ending thereafter. "FIXED
CHARGE COVERAGE RATIO" means for any period, the ratio of (i) EBITDA for such
period MINUS cash capital expenditures made (to the extent not already incurred
in a prior period) or incurred during such period, to (ii) the sum of (a)
interest expense, (b) principal payments required to be paid during such period
in respect of indebtedness, and (c) all federal, state, and local income taxes
accrued, all as determined for the twelve months ending on the determination
date for the Company and its subsidiaries on a consolidated basis without
duplication and in accordance with generally accepted accounting principles
consistently applied. "EBITDA" means, with respect to any fiscal period, the
Company's and its subsidiaries' consolidated net earnings (or loss), minus
extraordinary gains and interest income, plus interest expense, income taxes,
and depreciation and amortization for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(v) LEVERAGE RATIO. The Company shall not permit the
Leverage Ratio, as determined as of the end of each Fiscal Quarter, to be
greater than the amount set forth in the following table for the Fiscal Quarters
ending in the period set forth opposite thereto:
LEVERAGE RATIO PERIOD
-------------- ------
4.50:1.0 04/30/05 - 10/30/05
4.30:1.0 10/31/05 - 10/30/06
4.00:1.0 10/31/06 - 10/30/07
3.80:1.0 10/31/07 - 10/30/08
"LEVERAGE RATIO" means, at any date of determination, the
ratio of (a) Total Debt at such date to (b) EBITDA for the applicable period
ending on such date. "TOTAL DEBT" means,
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#2785-002
as of any date of determination, without duplication, the sum of (a) the
outstanding aggregate amount of the obligations for borrowed money, (b) the
outstanding principal amount of capital leases, (c) the outstanding principal
amount of purchase money indebtedness, (d) the outstanding principal amount of
funded debt, and (e) the outstanding principal amount of all obligations owing
to GECC, DVI and USBPS; all as determined for the Company and its subsidiaries
on a consolidated basis without duplication and in accordance with generally
accepted accounting principles consistently applied.
(vi) EBITDA MARGIN. The Company shall not permit the
EBITDA Margin to be less than 25% as of the end of any Fiscal Quarter ending on
or after April 30, 2005. "EBITDA MARGIN" means for any period, the ratio of (a)
EBITDA for such period, to (b) net revenues (excluding the professional service
fee component of radiology services) for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(vii) RECEIVABLE DAYS. The Company shall not permit
the Receivable Days to exceed 65 days as of the end of any Fiscal Quarter ending
on or after April 30, 2005. "RECEIVABLE DAYS" means for any period, a number
equal to (a) 365 divided by (b) the result of (i) net revenues for such period
divided by (ii) net receivables for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(viii) NAME CHANGES, ETC. The Company agrees that it
shall not change its name or jurisdiction of organization without giving 30 days
prior written notice to USBPS.
10. To induce USBPS on behalf of the Trustee to enter this
Agreement, the Guarantors hereby affirm and restate their Guarantees as related
to this Loan and AMENDED AND RESTATED RIDER A.
11. Radnet I, the Company and the Guarantors each represent
and warrant that each has been represented by an attorney of its choice and is
fully aware of the terms contained in this Agreement and AMENDED AND RESTATED
RIDER A to which it is a party which was voluntarily entered into without
coercion or duress of any kind.
12. Radnet I represents and warrants to USBPS on behalf of the
Noteholders and Trustee that all necessary actions on the part of Radnet I to be
taken in connection with the execution, delivery and performance of this
Agreement have been taken; the performance by
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#2785-002
Radnet I of this Agreement and the AMENDED AND RESTATED RIDER A will not violate
any of Radnet I's Articles of Incorporation, Articles of Formation, Partnership
Agreement or other agreement or law by which Radnet I is bound.
13. Any notice, request, direction, consent, approval, waiver
or other communication required or permitted under this Agreement to be sent
must be in writing and will become effective only upon delivery to USBPS at the
address set forth herein as follows:
U.S. Bank Portfolio Services
0000 Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxx, XX 00000
Attn: Xxxx Xxx, Director of Operations
14. Except as provided herein, and in the AMENDED AND RESTATED
RIDER A, all of the other provisions of the Loan Documents not restated will
remain in effect.
15. This Agreement and the documents referenced herein
constitute the entire and final agreement among the parties with respect to the
subject matter hereof and there are no agreements, understandings, warranties or
representations among the parties with respect to these matters except as set
forth herein.
16. This Agreement will inure to the benefit of and bind the
parties and their respective successors and permitted assigns.
17. Neither this Agreement nor any of the provisions hereof
can be changed, waived, discharged or terminated except by an instrument in
writing signed by the parties against whom such enforcement of the change,
waiver, discharge or termination is sought.
18. This Agreement will be interpreted and construed under the
laws of the Commonwealth of Pennsylvania, regardless of the domicile of any
party and will be considered to have been made, executed and performed in
Pennsylvania. BRMFS1 509512v2
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19. THE UNDERSIGNED, AND SUBJECT TO THE PROVISIONS CONTAINED
HEREIN, USBPS FOR ITSELF AND AS AGENT FOR THE TRUSTEE, (A) AGREE TO SUBMIT FOR
THEMSELVES, IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT AND ANY
SCHEDULE OR FOR RECOGNITION AND ENFORCEMENT OF ANY JUDGMENT IN RESPECT HEREOF OR
THEREOF, TO THE EXCLUSIVE JURISDICTION OF THE COURTS OF THE COMONWEALTH OF
PENNSYLVANIA, THE COURTS OF THE UNITED STATES OF AMERICA FOR THE EASTERN
DISTRICT OF PENNSYLVANIA, AND APPELLATE COURTS FROM ANY THEREOF, (B) CONSENT
THAT ANY ACTION OR PROCEEDING SHALL BE BROUGHT IN SUCH COURTS, AND WAIVE ANY
OBJECTION THAT EACH MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH ACTION OR
PROCEEDING IN ANY SUCH COURT, (C) AGREE THAT SERVICE OF PROCESS OF ANY SUCH
ACTION OR PROCEEDING MAY BE EFFECTED BY CERTIFIED MAIL (OR ANY SUBSTANTIALLY
SIMILAR FORM OF MAIL), POSTAGE PREPAID, TO THE APPROPRIATE PARTY AT ITS ADDRESS
AS SET FORTH HEREIN, AND SERVICE MADE SHALL BE DEEMED TO BE COMPLETED UPON THE
EARLIER OF ACTUAL RECEIPT OR FIVE (5) DAYS AFTER THE SAME SHALL HAVE BEEN POSTED
AS AFORESAID, AND (D) AGREE THAT NOTHING HEREIN OR IN ANY EXHIBIT OR SCHEDULE
SHALL AFFECT THE RIGHT TO EFFECT SERVICE OF PROCESS IN ANY OTHER MANNER
PERMITTED BY LAW. USBPS AND THE UNDERSIGNED EACH HEREBY UNCONDITIONALLY WAIVES
ITS RIGHT TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING
OUT OF, DIRECTLY OR INDIRECTLY, THIS AGREEMENT, ANY EXHIBIT AND THE TRANSACTIONS
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#2785-002
CONTEMPLATED HEREBY AND THEREBY, ANY OF THE RELATED DOCUMENTS, ANY DEALINGS
BETWEEN THE PARTIES HERETO RELATING TO THE SUBJECT MATTER HEREOF OR THEREOF,
AND/OR THE RELATIONSHIP THAT IS BEING ESTABLISHED BETWEEN USBPS AS AGENT FOR THE
TRUSTEE AND THE UNDERSIGNED, PROVIDED USBPS MAY IN ITS DISCRETION ENFORCE THE
TERMS OF THE FORUM SELECTION PROVISIONS IN THE LOANS.
20. Radnet I, the Company and the Guarantors hereby release
USBPS, the Trustee, and the Noteholders from and against any claim, loss, or
damage arising out of the negotiation execution, and performance of the Loan or
related matters prior to the date hereof.
21. This Agreement may be executed in two or more counterparts
and each counterpart shall be deemed an original.
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#2785-002
LYON FINANCIAL SERVICES, INC. DBA U.S.
BANK PORTFOLIO SERVICES, AS SUCCESSOR
SERVICER FOR DVI RECEIVABLES XVI, L.L.C.
AND AS AGENT FOR U.S. BANK, N.A., AS TRUSTEE
RADNET MANAGEMENT I, INC.
By: ________________________________________
RADNET MANAGEMENT, INC.
By: ________________________________________
ACKNOWLEDGED AND AGREED TO:
Primedex Health Systems, Inc., Guarantor
By: ____________________________________
Radnet Management, Inc., Guarantor
By: ____________________________________
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#2785-001
AMENDMENT TO LOAN DOCUMENTS
---------------------------
AGREEMENT made as of June 30, 2004 ("AMENDMENT AGREEMENT" or
"AGREEMENT") by and between LYON FINANCIAL SERVICES, INC. DBA U.S. BANK
PORTFOLIO SERVICES, as Successor Servicer for DVI Receivables XIV, L.L.C. and as
Agent for U.S. Bank, N.A., as Trustee, with offices at 0000 Xxxxxx Xxxxxx, Xxxxx
000, Xxxxxxxx, Xxxxxxxxx 00000 ("USBPS") and Radnet Management I, Inc., a
corporation, with offices at 0000 Xxxxxx Xxxxxx, Xxx Xxxxxxx, XX 00000 ("RADNET
I"), and such other signatories hereto.
WHEREAS, on or about August 31, 2000, Radnet I executed and
delivered to DVI Financial Services Inc. ("DVI") a Master Loan Agreement
collectively with the Secured Promissory Note Number #2785-001 dated August 31,
2000 (the "LOAN");
WHEREAS, to secure the payment of the Loan and all other
obligations of Radnet I to DVI (collectively the "OBLIGATIONS"), Radnet I,
pursuant to a Master Security Agreement dated on or about August 31, 2000 (the
"SECURITY AGREEMENT"), granted DVI a first priority security interest in certain
Collateral described therein;
WHEREAS, to further secure payment of the Note and all other
Obligations of Radnet I to DVI, Radnet I delivered to DVI the guarantees (the
"GUARANTEES") of Primedex Health Systems, Inc. and Radnet Management, Inc. (each
a "GUARANTOR", and collectively the "GUARANTORS") (the Guarantees together with
the Loan and ancillary documents are, collectively, the "LOAN DOCUMENTS");
WHEREAS, substantially contemporaneously therewith, DVI
contributed all of the Loan Documents to DVI Receivables XIV, L.L.C. ("DVI XIV")
and thereafter pursuant to an Amended and Restated Indenture, DVI XIV granted a
first priority security interest in and pledged all of the Loan Documents in
favor of U.S. Bank, N.A., as Trustee, for the benefit of a
#2785-001
noteholder which purchased asset backed promissory notes issued by DVI XIV (the
"Noteholder");
WHEREAS, DVI contributed other Loans with Radnet I or certain
affiliates of Radnet I to this and other DVI securitizations (collectively the
"RELATED LOANS"); WHEREAS, Radnet I is in default under the terms of the Loan;
WHEREAS, Radnet I has requested USBPS to modify the Loan to
reflect an adjustment in payments;
WHEREAS, Radnet I and/or certain of its affiliates have agreed
to modify the Related Loans;
WHEREAS, Radnet I and certain of its affiliates are engaged in
negotiations to restructure or modify certain loan agreements, loans and
promissory notes with each of General Electric Capital Corporation ("GECC") and
DVI (with respect to GECC, the "GECC MODIFICATION", and with respect to DVI, the
"DVI MODIFICATION");
WHEREAS, subject to the following terms and conditions, USBPS
is willing to modify the Loan as hereinafter provided.
NOW, THEREFORE, the parties agree as follows:
1. All of the Whereas clauses are incorporated herein as if
hereinafter set forth at full length.
2. Radnet I acknowledges that it is duly indebted to the
Trustee in the sum set forth on AMENDED AND RESTATED RIDER A annexed hereto, and
has no defenses, counterclaims or offsets to such indebtedness.
3. USBPS as Agent for the Trustee will modify the Loan to
provide for payments to commence in accordance with the attached revised payment
schedule (the
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"AMENDED AND RESTATED RIDER A"). Radnet I may, at any time, prepay all of the
outstanding Obligations subject to an additional prepayment fee of 2% of such
Obligations. Partial prepayments of the Obligations shall not be permitted at
any time.
4. This Agreement shall become effective upon the date that
USBPS receives this Agreement duly executed by Radnet I and the satisfaction of
each of the following conditions:
(a) Radnet I and/or its affiliates shall have entered
into agreements on similar terms to this Agreement and
otherwise in form and substance satisfactory to USBPS,
relating to the Related Loans (the "Related Loan
Modifications");
(b) reimbursement of USBPS's legal fees incurred in
connection with the execution of this Agreement and the
Related Loan Modifications, aggregating $50,000, shall have
been received by USBPS;
(c) Radnet I and/or its affiliates shall have entered
into the GECC Modification and the DVI Modification.
5. The closing of the restructuring of the Radnet I Loan is
further subject to delivery to USBPS of all of the following, each in form and
substance satisfactory to USBPS and its counsel:
(a) The executed AMENDED AND RESTATED RIDER A;
(b) An executed copy of this Agreement;
(c) Such other documents, including UCC financing
statements as USBPS reasonably requests.
6. Radnet I hereby acknowledges and agrees that it has no,
and will not assert any, defenses, counterclaims or offsets to the Loan and
AMENDED AND RESTATED RIDER A and acknowledges and agrees that the Trustee holds
a first-priority security interest in the Collateral.
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7. Any default or other breach of any obligation under the
GECC Modification, the DVI Modification, or any of the Related Loan
Modifications shall constitute a default under the Loan as modified by this
Agreement, and USBPS shall have all remedies thereunder.
8. Radnet I hereby releases the Noteholder, USBPS individually
and as agent for the Trustee and the special purpose entities for which the
Trustee holds collateral, from and against any claims, loss or damage of any
kind or nature arising out of the Loan.
9. So long as any of the Obligations remain outstanding,
Radnet Management, Inc. (the "COMPANY") agrees as follows:
(i) FINANCIAL REPORTING. The Company shall furnish
the following documents or information to USBPS:
(A) Within 30 days after the end of each
Fiscal Quarter (as defined below) (i) (or 90 days in respect of the last month
of the fiscal year), the Company's consolidated, consolidating and on a center
by center basis, financial statements, including the most recent annual report,
balance sheet (not on a center by center basis) and income statement, prepared
in accordance with generally accepted accounting principles, which reports, the
Company warrants, shall fully and fairly represent the true financial condition
of the Company and (ii) updated projections for the Company and for each center;
(B) any other financial information normally
provided by the Company to the public; and
(C) Such other financial data or information
relative to this Amendment Agreement, including, without limitation, listings of
serial numbers or other identification data and confirmations of such
information, as USBPS may time-to-time reasonably request.
(ii) NO AMENDMENTS. Subsequent to the date of this
Amendment Agreement, the Company will not agree or consent to any amendments or
modifications to any agreement between the Company and DVI, GECC or Xxxxx Fargo
Foothill, Inc. ("FOOTHILL") containing terms (including, but not limited to,
increasing interest rates, accelerating the principal amortization or maturity,
new or more stringent defaults, additional collateral, and new remedies
provisions) that would be more onerous to the Company, or adversely impact or
affect GECC with respect to the terms of this Amendment Agreement.
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#2785-001
(iii) DISTRIBUTIONS. The Company shall not make any
distribution or declare or pay any dividends (in cash or other property, other
than common stock) on, or purchase, acquire, redeem, or retire any of the
Company's stock, of any class, whether now or hereafter outstanding
(collectively, "DISTRIBUTIONS"); PROVIDED, HOWEVER, that so long as no default
shall have occurred and be continuing immediately prior to or after giving
effect to any such payment, (a) the Company may make Distributions to Primedex
Health Systems, Inc., a New York corporation (the "PARENT") (1) in amounts
necessary to pay customary expenses of Parent in the ordinary course of its
business as a public holding company (including salaries and related reasonable
and customary expenses incurred by employees of Parent) in an aggregate amount
not to exceed $750,000 in any fiscal year, (2) in amounts necessary to enable
Parent to pay taxes when due and owing by it in the ordinary course of its
business as a holding company and (3) in amounts necessary to enable Parent to
pay interest on those certain 11.5% Series A Convertible Subordinated Notes due
June 30, 2008, issued by Parent on June 25, 1993, and (b) Parent may make
Distributions in the form of common stock.
(iv) FIXED CHARGE COVERAGE RATIO. Commencing April
30, 2005, the Company shall not permit the Fixed Charge Coverage Ratio, (a) to
be less than 1.0:1 as of the end of each April, July, October and January (each,
a "FISCAL QUARTER") ending prior to January 1, 2007, and (b) to be less than
1.05:1 as of the last day of each Fiscal Quarter ending thereafter. "FIXED
CHARGE COVERAGE RATIO" means for any period, the ratio of (i) EBITDA for such
period MINUS cash capital expenditures made (to the extent not already incurred
in a prior period) or incurred during such period, to (ii) the sum of (a)
interest expense, (b) principal payments required to be paid during such period
in respect of indebtedness, and (c) all federal, state, and local income taxes
accrued, all as determined for the twelve months ending on the determination
date for the Company and its subsidiaries on a consolidated basis without
duplication and in accordance with generally accepted accounting principles
consistently applied. "EBITDA" means, with respect to any fiscal period, the
Company's and its subsidiaries' consolidated net earnings (or loss), minus
extraordinary gains and interest income, plus interest expense, income taxes,
and depreciation and amortization for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(v) LEVERAGE RATIO. The Company shall not permit the
Leverage Ratio, as determined as of the end of each Fiscal Quarter, to be
greater than the amount set forth in the following table for the Fiscal Quarters
ending in the period set forth opposite thereto:
LEVERAGE RATIO PERIOD
-------------- ------
4.50:1.0 04/30/05 - 10/30/05
4.30:1.0 10/31/05 - 10/30/06
4.00:1.0 10/31/06 - 10/30/07
3.80:1.0 10/31/07 - 10/30/08
"LEVERAGE RATIO" means, at any date of determination, the
ratio of (a) Total Debt at such date to (b) EBITDA for the applicable period
ending on such date. "TOTAL DEBT" means,
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#2785-001
as of any date of determination, without duplication, the sum of (a) the
outstanding aggregate amount of the obligations for borrowed money, (b) the
outstanding principal amount of capital leases, (c) the outstanding principal
amount of purchase money indebtedness, (d) the outstanding principal amount of
funded debt, and (e) the outstanding principal amount of all obligations owing
to GECC, DVI and USBPS; all as determined for the Company and its subsidiaries
on a consolidated basis without duplication and in accordance with generally
accepted accounting principles consistently applied.
(vi) EBITDA MARGIN. The Company shall not permit the
EBITDA Margin to be less than 25% as of the end of any Fiscal Quarter ending on
or after April 30, 2005. "EBITDA MARGIN" means for any period, the ratio of (a)
EBITDA for such period, to (b) net revenues (excluding the professional service
fee component of radiology services) for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(vii) RECEIVABLE DAYS. The Company shall not permit
the Receivable Days to exceed 65 days as of the end of any Fiscal Quarter ending
on or after April 30, 2005. "RECEIVABLE DAYS" means for any period, a number
equal to (a) 365 divided by (b) the result of (i) net revenues for such period
divided by (ii) net receivables for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(viii) NAME CHANGES, ETC. The Company agrees that it
shall not change its name or jurisdiction of organization without giving 30 days
prior written notice to USBPS.
10. To induce USBPS on behalf of the Trustee to enter this
Agreement, the Guarantors hereby affirm and restate their Guarantees as related
to this Loan and AMENDED AND RESTATED RIDER A.
11. Radnet I, the Company and the Guarantors each represent
and warrant that each has been represented by an attorney of its choice and is
fully aware of the terms contained in this Agreement and AMENDED AND RESTATED
RIDER A to which it is a party which was voluntarily entered into without
coercion or duress of any kind.
12. Radnet I represents and warrants to USBPS on behalf of the
Noteholders and Trustee that all necessary actions on the part of Radnet I to be
taken in connection with the execution, delivery and performance of this
Agreement have been taken; the performance by
6
#2785-001
Radnet I of this Agreement and the AMENDED AND RESTATED RIDER A will not violate
any of Radnet I's Articles of Incorporation, Articles of Formation, Partnership
Agreement or other agreement or law by which Radnet I is bound.
13. Any notice, request, direction, consent, approval, waiver
or other communication required or permitted under this Agreement to be sent
must be in writing and will become effective only upon delivery to USBPS at the
address set forth herein as follows:
U.S. Bank Portfolio Services
0000 Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxx, XX 00000
Attn: Xxxx Xxx, Director of Operations
14. Except as provided herein, and in the AMENDED AND RESTATED
RIDER A, all of the other provisions of the Loan Documents not restated will
remain in effect.
15. This Agreement and the documents referenced herein
constitute the entire and final agreement among the parties with respect to the
subject matter hereof and there are no agreements, understandings, warranties or
representations among the parties with respect to these matters except as set
forth herein.
16. This Agreement will inure to the benefit of and bind the
parties and their respective successors and permitted assigns.
17. Neither this Agreement nor any of the provisions hereof
can be changed, waived, discharged or terminated except by an instrument in
writing signed by the parties against whom such enforcement of the change,
waiver, discharge or termination is sought.
18. This Agreement will be interpreted and construed under the
laws of the Commonwealth of Pennsylvania, regardless of the domicile of any
party and will be considered to have been made, executed and performed in
Pennsylvania.
7
#2785-001
19. THE UNDERSIGNED, AND SUBJECT TO THE PROVISIONS CONTAINED
HEREIN, USBPS FOR ITSELF AND AS AGENT FOR THE TRUSTEE, (A) AGREE TO SUBMIT FOR
THEMSELVES, IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT AND ANY
SCHEDULE OR FOR RECOGNITION AND ENFORCEMENT OF ANY JUDGMENT IN RESPECT HEREOF OR
THEREOF, TO THE EXCLUSIVE JURISDICTION OF THE COURTS OF THE COMONWEALTH OF
PENNSYLVANIA, THE COURTS OF THE UNITED STATES OF AMERICA FOR THE EASTERN
DISTRICT OF PENNSYLVANIA, AND APPELLATE COURTS FROM ANY THEREOF, (B) CONSENT
THAT ANY ACTION OR PROCEEDING SHALL BE BROUGHT IN SUCH COURTS, AND WAIVE ANY
OBJECTION THAT EACH MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH ACTION OR
PROCEEDING IN ANY SUCH COURT, (C) AGREE THAT SERVICE OF PROCESS OF ANY SUCH
ACTION OR PROCEEDING MAY BE EFFECTED BY CERTIFIED MAIL (OR ANY SUBSTANTIALLY
SIMILAR FORM OF MAIL), POSTAGE PREPAID, TO THE APPROPRIATE PARTY AT ITS ADDRESS
AS SET FORTH HEREIN, AND SERVICE MADE SHALL BE DEEMED TO BE COMPLETED UPON THE
EARLIER OF ACTUAL RECEIPT OR FIVE (5) DAYS AFTER THE SAME SHALL HAVE BEEN POSTED
AS AFORESAID, AND (D) AGREE THAT NOTHING HEREIN OR IN ANY EXHIBIT OR SCHEDULE
SHALL AFFECT THE RIGHT TO EFFECT SERVICE OF PROCESS IN ANY OTHER MANNER
PERMITTED BY LAW. USBPS AND THE UNDERSIGNED EACH HEREBY UNCONDITIONALLY WAIVES
ITS RIGHT TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING
OUT OF, DIRECTLY OR INDIRECTLY, THIS AGREEMENT, ANY EXHIBIT AND THE TRANSACTIONS
8
#2785-001
CONTEMPLATED HEREBY AND THEREBY, ANY OF THE RELATED DOCUMENTS, ANY DEALINGS
BETWEEN THE PARTIES HERETO RELATING TO THE SUBJECT MATTER HEREOF OR THEREOF,
AND/OR THE RELATIONSHIP THAT IS BEING ESTABLISHED BETWEEN USBPS AS AGENT FOR THE
TRUSTEE AND THE UNDERSIGNED, PROVIDED USBPS MAY IN ITS DISCRETION ENFORCE THE
TERMS OF THE FORUM SELECTION PROVISIONS IN THE LOANS.
20. Radnet I, the Company and the Guarantors hereby release
USBPS, the Trustee, and the Noteholders from and against any claim, loss, or
damage arising out of the negotiation execution, and performance of the Loan or
related matters prior to the date hereof.
21. This Agreement may be executed in two or more counterparts
and each counterpart shall be deemed an original.
9
#2785-001
LYON FINANCIAL SERVICES, INC. DBA U.S.
BANK PORTFOLIO SERVICES, AS SUCCESSOR
SERVICER FOR DVI RECEIVABLES XIV, L.L.C.
AND AS AGENT FOR U.S. BANK, N.A., AS TRUSTEE
By: ________________________________________
RADNET MANAGEMENT I, INC.
By: ________________________________________
RADNET MANAGEMENT, INC.
By: ________________________________________
ACKNOWLEDGED AND AGREED TO:
Primedex Health Systems, Inc., Guarantor
By: ____________________________________
Radnet Management, Inc., Guarantor
By: ____________________________________
10
#3564-001
AMENDMENT TO LOAN DOCUMENTS
---------------------------
AGREEMENT made as of June 30, 2004 ("AMENDMENT AGREEMENT" or
"AGREEMENT") by and between LYON FINANCIAL SERVICES, INC. DBA U.S. BANK
PORTFOLIO SERVICES, as Successor Servicer for DVI Receivables XVIII, L.L.C. and
as Agent for U.S. Bank, N.A., as Trustee, with offices at 0000 Xxxxxx Xxxxxx,
Xxxxx 000, Xxxxxxxx, Xxxxxxxxx 00000 ("USBPS") and Radnet Sub, Inc., a
corporation, with offices at 0000 Xxxxxx Xxxxxx, Xxx Xxxxxxx, XX 00000
("RADNET"), and such other signatories hereto.
WHEREAS, on or about July 2, 2002, Radnet executed and
delivered to DVI Financial Services Inc. ("DVI") a Amended, Restated and
Consolidated Master Loan Agreement collectively with the Secured Promissory Note
Number #3564-001 dated July 2, 2002 (the "LOAN");
WHEREAS, to secure the payment of the Loan and all other
obligations of Radnet to DVI (collectively the "OBLIGATIONS"), Radnet, pursuant
to a Amended, Restated and Consolidated Master Security Agreement dated on or
about July 2, 2002 (the "SECURITY AGREEMENT"), granted DVI a first priority
security interest in certain Collateral described therein;
WHEREAS, to further secure payment of the Note and all other
Obligations of Radnet to DVI, Radnet delivered to DVI the guarantee (the
"GUARANTEE") of Primedex Health Systems, Inc. (the "GUARANTOR") (the "GUARANTEE"
together with the Loan and ancillary documents are, collectively the "LOAN
DOCUMENTS");
WHEREAS, substantially contemporaneously therewith, DVI
contributed all of the Loan Documents to DVI Receivables XVIII, L.L.C. ("DVI
XVIII") and thereafter pursuant to an Amended and Restated Indenture, DVI XVIII
granted a first priority security interest in and
pledged all of the Loan Documents in favor of U.S. Bank, N.A., as Trustee, for
the benefit of a noteholder which purchased asset backed promissory notes issued
by DVI XVIII (the "Noteholder");
WHEREAS, DVI contributed other Loans with Radnet or certain
affiliates of Radnet to this and other DVI securitizations (collectively the
"RELATED LOANS");
WHEREAS, Radnet is in default under the terms of the Loan;
WHEREAS, Radnet has requested USBPS to modify the Loan to
reflect an adjustment in payments;
WHEREAS, Radnet and/or certain of its affiliates have agreed
to modify the Related Loans;
WHEREAS, Radnet and certain of its affiliates are engaged in
negotiations to restructure or modify certain loan agreements, loans and
promissory notes with each of General Electric Capital Corporation ("GECC") and
DVI (with respect to GECC, the "GECC MODIFICATION", and with respect to DVI, the
"DVI MODIFICATION");
WHEREAS, subject to the following terms and conditions, USBPS
is willing to modify the Loan as hereinafter provided.
NOW, THEREFORE, the parties agree as follows:
1. All of the Whereas clauses are incorporated herein as if
hereinafter set forth at full length.
2. Radnet acknowledges that it is duly indebted to the Trustee
in the sum set forth on AMENDED AND RESTATED RIDER A annexed hereto, and has no
defenses, counterclaims or offsets to such indebtedness.
2
3. USBPS as Agent for the Trustee will modify the Loan to
provide for payments to commence in accordance with the attached revised payment
schedule (the "AMENDED AND RESTATED RIDER A"). Radnet may, at any time, prepay
all of the then outstanding Obligations subject to an additional prepayment fee
of 2% of such Obligations. Partial prepayments of the Obligations shall not be
permitted at any time.
4. This Agreement shall become effective upon the date that
USBPS receives this Agreement duly executed by Radnet and the
satisfaction of each of the following conditions:
(a) Radnet and/or its affiliates shall have entered
into agreements on similar terms to this Agreement and
otherwise in form and substance satisfactory to USBPS,
relating to the Related Loans (the "Related Loan
Modifications");
(b) reimbursement of USBPS's legal fees incurred in
connection with the execution of this Agreement and the
Related Loan Modifications, aggregating $50,000, shall have
been received by USBPS;
(c) Radnet and/or its affiliates shall have entered
into the GECC Modification and the DVI Modification.
5. The closing of the restructuring of the Radnet Loan is
further subject to delivery to USBPS of all of the following, each in form and
substance satisfactory to USBPS and its counsel:
(a) The executed AMENDED AND RESTATED RIDER A;
(b) An executed copy of this Agreement;
(c) Such other documents, including UCC financing
statements as USBPS reasonably requests.
6. Radnet hereby acknowledges and agrees that it has no, and
will not assert any, defenses, counterclaims or offsets to the Loan and AMENDED
AND RESTATED RIDER A and acknowledges and agrees that the Trustee holds a
first-priority security interest in the Collateral.
3
7. Any default or other breach of any obligation under the
GECC Modification, the DVI Modification, or any of the Related Loan
Modifications shall constitute a default under the Loan as modified by this
Agreement, and USBPS shall have all remedies thereunder.
8. Radnet hereby releases the Noteholder, USBPS individually
and as agent for the Trustee and the special purpose entities for which the
Trustee holds collateral, from and against any claims, loss or damage of any
kind or nature arising out of the Loan.
9. So long as any of the Obligations remain outstanding,
Radnet Management, Inc. (the "COMPANY") agrees as follows:
(i) FINANCIAL REPORTING. The Company shall furnish
the following documents or information to USBPS:
(A) Within 30 days after the end of each
Fiscal Quarter (as defined below) (i) (or 90 days in respect of the last month
of the fiscal year), the Company's consolidated, consolidating and on a center
by center basis, financial statements, including the most recent annual report,
balance sheet (not on a center by center basis) and income statement, prepared
in accordance with generally accepted accounting principles, which reports, the
Company warrants, shall fully and fairly represent the true financial condition
of the Company and (ii) updated projections for the Company and for each center;
(B) any other financial information normally
provided by the Company to the public; and
(C) Such other financial data or information
relative to this Amendment Agreement, including, without limitation, listings of
serial numbers or other identification data and confirmations of such
information, as USBPS may time-to-time reasonably request.
(ii) NO AMENDMENTS. Subsequent to the date of this
Amendment Agreement, the Company will not agree or consent to any amendments or
modifications to any agreement between the Company and DVI, GECC or Xxxxx Fargo
Foothill, Inc. ("FOOTHILL") containing terms (including, but not limited to,
increasing interest rates, accelerating the principal amortization or maturity,
new or more stringent defaults, additional collateral, and new remedies
provisions) that would be more onerous to the Company, or adversely impact or
affect GECC with respect to the terms of this Amendment Agreement.
4
(iii) DISTRIBUTIONS. The Company shall not make any
distribution or declare or pay any dividends (in cash or other property, other
than common stock) on, or purchase, acquire, redeem, or retire any of the
Company's stock, of any class, whether now or hereafter outstanding
(collectively, "DISTRIBUTIONS"); PROVIDED, HOWEVER, that so long as no default
shall have occurred and be continuing immediately prior to or after giving
effect to any such payment, (a) the Company may make Distributions to Primedex
Health Systems, Inc., a New York corporation (the "PARENT") (1) in amounts
necessary to pay customary expenses of Parent in the ordinary course of its
business as a public holding company (including salaries and related reasonable
and customary expenses incurred by employees of Parent) in an aggregate amount
not to exceed $750,000 in any fiscal year, (2) in amounts necessary to enable
Parent to pay taxes when due and owing by it in the ordinary course of its
business as a holding company and (3) in amounts necessary to enable Parent to
pay interest on those certain 11.5% Series A Convertible Subordinated Notes due
June 30, 2008, issued by Parent on June 25, 1993, and (b) Parent may make
Distributions in the form of common stock.
(iv) FIXED CHARGE COVERAGE RATIO. Commencing April
30, 2005, the Company shall not permit the Fixed Charge Coverage Ratio, (a) to
be less than 1.0:1 as of the end of each April, July, October and January (each,
a "FISCAL QUARTER") ending prior to January 1, 2007, and (b) to be less than
1.05:1 as of the last day of each Fiscal Quarter ending thereafter. "FIXED
CHARGE COVERAGE RATIO" means for any period, the ratio of (i) EBITDA for such
period MINUS cash capital expenditures made (to the extent not already incurred
in a prior period) or incurred during such period, to (ii) the sum of (a)
interest expense, (b) principal payments required to be paid during such period
in respect of indebtedness, and (c) all federal, state, and local income taxes
accrued, all as determined for the twelve months ending on the determination
date for the Company and its subsidiaries on a consolidated basis without
duplication and in accordance with generally accepted accounting principles
consistently applied. "EBITDA" means, with respect to any fiscal period, the
Company's and its subsidiaries' consolidated net earnings (or loss), minus
extraordinary gains and interest income, plus interest expense, income taxes,
and depreciation and amortization for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(v) LEVERAGE RATIO. The Company shall not permit the
Leverage Ratio, as determined as of the end of each Fiscal Quarter, to be
greater than the amount set forth in the following table for the Fiscal Quarters
ending in the period set forth opposite thereto:
LEVERAGE RATIO Period
-------------- ------
4.50:1.0 04/30/05 - 10/30/05
4.30:1.0 10/31/05 - 10/30/06
4.00:1.0 10/31/06 - 10/30/07
3.80:1.0 10/31/07 - 10/30/08
"LEVERAGE RATIO" means, at any date of determination, the
ratio of (a) Total Debt at such date to (b) EBITDA for the applicable period
ending on such date. "TOTAL DEBT" means, as of any date of determination,
5
without duplication, the sum of (a) the outstanding aggregate amount of the
obligations for borrowed money, (b) the outstanding principal amount of capital
leases, (c) the outstanding principal amount of purchase money indebtedness, (d)
the outstanding principal amount of funded debt, and (e) the outstanding
principal amount of all obligations owing to GECC, DVI and USBPS; all as
determined for the Company and its subsidiaries on a consolidated basis without
duplication and in accordance with generally accepted accounting principles
consistently applied.
(vi) EBITDA MARGIN. The Company shall not permit the
EBITDA Margin to be less than 25% as of the end of any Fiscal Quarter ending on
or after April 30, 2005. "EBITDA MARGIN" means for any period, the ratio of (a)
EBITDA for such period, to (b) net revenues (excluding the professional service
fee component of radiology services) for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(vii) RECEIVABLE DAYS. The Company shall not permit
the Receivable Days to exceed 65 days as of the end of any Fiscal Quarter ending
on or after April 30, 2005. "RECEIVABLE DAYS" means for any period, a number
equal to (a) 365 divided by (b) the result of (i) net revenues for such period
divided by (ii) net receivables for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(viii) NAME CHANGES, ETC. The Company agrees that it
shall not change its name or jurisdiction of organization without giving 30 days
prior written notice to USBPS.
10. To induce USBPS on behalf of the Trustee to enter this
Agreement, the Guarantor hereby affirms and restates its Guarantee as related to
this Loan and AMENDED AND RESTATED RIDER A.
11. Radnet, the Company and the Guarantor each represent and
warrant that each has been represented by an attorney of its choice and is fully
aware of the terms contained in this Agreement and AMENDED AND RESTATED RIDER A
to which it is a party which was voluntarily entered into without coercion or
duress of any kind.
12. Radnet represents and warrants to USBPS on behalf of the
Noteholders and Trustee that all necessary actions on the part of Radnet to be
taken in connection with the execution, delivery and performance of this
Agreement have been taken; the performance by Radnet of this Agreement and the
AMENDED AND RESTATED RIDER A will not violate any of Radnet's Articles of
Incorporation, Articles of Formation, Partnership Agreement or other agreement
or law by which Radnet is bound.
6
13. Any notice, request, direction, consent, approval, waiver
or other communication required or permitted under this Agreement to be sent
must be in writing and will become effective only upon delivery to USBPS at the
address set forth herein as follows:
U.S. Bank Portfolio Services
0000 Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxx, XX 00000
Attn: Xxxx Xxx, Director of Operations
14. Except as provided herein, and in the AMENDED AND RESTATED
RIDER A, all of the other provisions of the Loan Documents not restated will
remain in effect.
15. This Agreement and the documents referenced herein
constitute the entire and final agreement among the parties with respect to the
subject matter hereof and there are no agreements, understandings, warranties or
representations among the parties with respect to these matters except as set
forth herein.
16. This Agreement will inure to the benefit of and bind the
parties and their respective successors and permitted assigns.
17. Neither this Agreement nor any of the provisions hereof
can be changed, waived, discharged or terminated except by an instrument in
writing signed by the parties against whom such enforcement of the change,
waiver, discharge or termination is sought.
18. This Agreement will be interpreted and construed under the
laws of the Commonwealth of Pennsylvania, regardless of the domicile of any
party and will be considered to have been made, executed and performed in
Pennsylvania.
7
19. THE UNDERSIGNED, AND SUBJECT TO THE PROVISIONS CONTAINED
HEREIN, USBPS FOR ITSELF AND AS AGENT FOR THE TRUSTEE, (A) AGREE TO SUBMIT FOR
THEMSELVES, IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT AND ANY
SCHEDULE OR FOR RECOGNITION AND ENFORCEMENT OF ANY JUDGMENT IN RESPECT HEREOF OR
THEREOF, TO THE EXCLUSIVE JURISDICTION OF THE COURTS OF THE COMONWEALTH OF
PENNSYLVANIA, THE COURTS OF THE UNITED STATES OF AMERICA FOR THE EASTERN
DISTRICT OF PENNSYLVANIA, AND APPELLATE COURTS FROM ANY THEREOF, (B) CONSENT
THAT ANY ACTION OR PROCEEDING SHALL BE BROUGHT IN SUCH COURTS, AND WAIVE ANY
OBJECTION THAT EACH MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH ACTION OR
PROCEEDING IN ANY SUCH COURT, (C) AGREE THAT SERVICE OF PROCESS OF ANY SUCH
ACTION OR PROCEEDING MAY BE EFFECTED BY CERTIFIED MAIL (OR ANY SUBSTANTIALLY
SIMILAR FORM OF MAIL), POSTAGE PREPAID, TO THE APPROPRIATE PARTY AT ITS ADDRESS
AS SET FORTH HEREIN, AND SERVICE MADE SHALL BE DEEMED TO BE COMPLETED UPON THE
EARLIER OF ACTUAL RECEIPT OR FIVE (5) DAYS AFTER THE SAME SHALL HAVE BEEN POSTED
AS AFORESAID, AND (D) AGREE THAT NOTHING HEREIN OR IN ANY EXHIBIT OR SCHEDULE
8
SHALL AFFECT THE RIGHT TO EFFECT SERVICE OF PROCESS IN ANY OTHER MANNER
PERMITTED BY LAW. USBPS AND THE UNDERSIGNED EACH HEREBY UNCONDITIONALLY WAIVES
ITS RIGHT TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING
OUT OF, DIRECTLY OR INDIRECTLY, THIS AGREEMENT, ANY EXHIBIT AND THE TRANSACTIONS
CONTEMPLATED HEREBY AND THEREBY, ANY OF THE RELATED DOCUMENTS, ANY DEALINGS
BETWEEN THE PARTIES HERETO RELATING TO THE SUBJECT MATTER HEREOF OR THEREOF,
AND/OR THE RELATIONSHIP THAT IS BEING ESTABLISHED BETWEEN USBPS AS AGENT FOR THE
TRUSTEE AND THE UNDERSIGNED, PROVIDED USBPS MAY IN ITS DISCRETION ENFORCE THE
TERMS OF THE FORUM SELECTION PROVISIONS IN THE LOANS.
20. Radnet, the Company and the Guarantor hereby release
USBPS, the Trustee, and the Noteholders from and against any claim, loss, or
damage arising out of the negotiation execution, and performance of the Loan or
related matters prior to the date hereof.
21. This Agreement may be executed in two or more counterparts
and each counterpart shall be deemed an original.
9
LYON FINANCIAL SERVICES, INC. DBA U.S. BANK
PORTFOLIO SERVICES, AS SUCCESSOR SERVICER
FOR DVI RECEIVABLES XVIII, L.L.C. AND AS
AGENT FOR U.S. BANK, N.A., AS TRUSTEE
By:_________________________________________
RADNET SUB, INC.
By:_________________________________________
RADNET MANAGEMENT, INC.
By:_________________________________________
ACKNOWLEDGED AND AGREED TO:
Primedex Health Systems, Inc., Guarantor
By:_____________________________________
10
AMENDMENT TO LOAN DOCUMENTS
---------------------------
AGREEMENT made as of June 30, 2004 ("AMENDMENT AGREEMENT" or
"AGREEMENT") by and between LYON FINANCIAL SERVICES, INC. DBA U.S. BANK
PORTFOLIO SERVICES, as Successor Servicer for DVI Receivables XVIII, L.L.C. and
as Agent for U.S. Bank, N.A., as Trustee, with offices at 0000 Xxxxxx Xxxxxx,
Xxxxx 000, Xxxxxxxx, Xxxxxxxxx 00000 ("USBPS") and Radnet Management, Inc., a
corporation, with offices at 0000 Xxxxxx Xxxxxx, Xxx Xxxxxxx, XX 00000
("RADNET"), and such other signatories hereto.
WHEREAS, on or about May 1, 2002, Radnet executed and
delivered to DVI Financial Services Inc. ("DVI") a Master Loan Agreement
collectively with the Amended and Restated Secured Promissory Note Number
#3502-005 dated July 2, 2002 (the "LOAN");
WHEREAS, to secure the payment of the Loan and all other
obligations of Radnet to DVI (collectively the "OBLIGATIONS"), Radnet, pursuant
to a Master Security Agreement dated on or about May 1, 2002 (the "SECURITY
AGREEMENT"), granted DVI a first priority security interest in certain
Collateral described therein;
WHEREAS, to further secure payment of the Note and all other
Obligations of Radnet to DVI, Radnet delivered to DVI the guarantee (the
"GUARANTEE") of Primedex Health Systems, Inc. (the "GUARANTOR") (the "GUARANTEE"
together with the Loan and ancillary documents are, collectively the "LOAN
DOCUMENTS");
WHEREAS, substantially contemporaneously therewith, DVI
contributed all of the Loan Documents to DVI Receivables XVIII, L.L.C. ("DVI
XVIII") and thereafter pursuant to an Amended and Restated Indenture, DVI XVIII
granted a first priority security interest in and pledged all of the Loan
Documents in favor of U.S. Bank, N.A., as Trustee, for the benefit of a
noteholder which purchased asset backed promissory notes issued by DVI XVIII
(the "Noteholder");
WHEREAS, DVI contributed other Loans with Radnet or certain
affiliates of Radnet to this and other DVI securitizations (collectively the
"RELATED LOANS");
WHEREAS, Radnet is in default under the terms of the Loan;
WHEREAS, Radnet has requested USBPS to modify the Loan to
reflect an adjustment in payments;
WHEREAS, Radnet and/or certain of its affiliates have agreed
to modify the Related Loans;
WHEREAS, Radnet and certain of its affiliates are engaged in
negotiations to restructure or modify certain loan agreements, loans and
promissory notes with each of General Electric Capital Corporation ("GECC") and
DVI (with respect to GECC, the "GECC MODIFICATION", and with respect to DVI, the
"DVI MODIFICATION");
WHEREAS, subject to the following terms and conditions, USBPS
is willing to modify the Loan as hereinafter provided. NOW,
THEREFORE, the parties agree as follows:
1. All of the Whereas clauses are incorporated herein as if
hereinafter set forth at full length.
2. Radnet acknowledges that it is duly indebted to the Trustee
in the sum set forth on AMENDED AND RESTATED RIDER A annexed hereto, and has no
defenses, counterclaims or offsets to such indebtedness.
3. USBPS as Agent for the Trustee will modify the Loan to
provide for payments to commence in accordance with the attached revised payment
schedule (the "AMENDED AND RESTATED RIDER A"). Radnet may, at any time, prepay
2
all of the then outstanding Obligations subject to an additional prepayment fee
of 2% of such Obligations. Partial prepayments of the Obligations shall not be
permitted at any time.
4. This Agreement shall become effective upon the date that
USBPS receives this Agreement duly executed by Radnet and the satisfaction of
each of the following conditions:
(a) Radnet and/or its affiliates shall have entered
into agreements on similar terms to this Agreement and
otherwise in form and substance satisfactory to USBPS,
relating to the Related Loans (the "Related Loan
Modifications");
(b) reimbursement of USBPS's legal fees incurred in
connection with the execution of this Agreement and the
Related Loan Modifications, aggregating $50,000, shall have
been received by USBPS;
(c) Radnet and/or its affiliates shall have entered
into the GECC Modification and the DVI Modification.
5. The closing of the restructuring of the Radnet Loan is
further subject to delivery to USBPS of all of the following, each in form and
substance satisfactory to USBPS and its counsel:
(a) The executed AMENDED AND RESTATED RIDER A;
(b) An executed copy of this Agreement;
(c) Such other documents, including UCC financing
statements as USBPS reasonably requests.
6. Radnet hereby acknowledges and agrees that it has no, and
will not assert any, defenses, counterclaims or offsets to the Loan and AMENDED
AND RESTATED RIDER A and acknowledges and agrees that the Trustee holds a
first-priority security interest in the Collateral.
7. Any default or other breach of any obligation under the
GECC Modification, the DVI Modification, or any of the Related Loan
Modifications shall constitute a default under the Loan as modified by this
Agreement, and USBPS shall have all remedies thereunder.
3
8. Radnet hereby releases the Noteholder, USBPS individually
and as agent for the Trustee and the special purpose entities for which the
Trustee holds collateral, from and against any claims, loss or damage of any
kind or nature arising out of the Loan.
9. So long as any of the Obligations remain outstanding,
Radnet Management, Inc. (the "COMPANY") agrees as follows:
(i) FINANCIAL REPORTING. The Company shall furnish
the following documents or information to USBPS:
(A) Within 30 days after the end of each
Fiscal Quarter (as defined below) (i) (or 90 days in respect of the last month
of the fiscal year), the Company's consolidated, consolidating and on a center
by center basis, financial statements, including the most recent annual report,
balance sheet (not on a center by center basis) and income statement, prepared
in accordance with generally accepted accounting principles, which reports, the
Company warrants, shall fully and fairly represent the true financial condition
of the Company and (ii) updated projections for the Company and for each center;
(B) any other financial information normally
provided by the Company to the public; and
(C) Such other financial data or information
relative to this Amendment Agreement, including, without limitation, listings of
serial numbers or other identification data and confirmations of such
information, as USBPS may time-to-time reasonably request.
(ii) NO AMENDMENTS. Subsequent to the date of this
Amendment Agreement, the Company will not agree or consent to any amendments or
modifications to any agreement between the Company and DVI, GECC or Xxxxx Fargo
Foothill, Inc. ("FOOTHILL") containing terms (including, but not limited to,
increasing interest rates, accelerating the principal amortization or maturity,
new or more stringent defaults, additional collateral, and new remedies
provisions) that would be more onerous to the Company, or adversely impact or
affect GECC with respect to the terms of this Amendment Agreement.
(iii) DISTRIBUTIONS. The Company shall not make any
distribution or declare or pay any dividends (in cash or other property, other
than common stock) on, or purchase, acquire, redeem, or retire any of the
Company's stock, of any class, whether now or hereafter outstanding
(collectively, "DISTRIBUTIONS"); PROVIDED, HOWEVER, that so long as no default
shall have occurred and be continuing immediately prior to or after giving
4
effect to any such payment, (a) the Company may make Distributions to Primedex
Health Systems, Inc., a New York corporation (the "PARENT") (1) in amounts
necessary to pay customary expenses of Parent in the ordinary course of its
business as a public holding company (including salaries and related reasonable
and customary expenses incurred by employees of Parent) in an aggregate amount
not to exceed $750,000 in any fiscal year, (2) in amounts necessary to enable
Parent to pay taxes when due and owing by it in the ordinary course of its
business as a holding company and (3) in amounts necessary to enable Parent to
pay interest on those certain 11.5% Series A Convertible Subordinated Notes due
June 30, 2008, issued by Parent on June 25, 1993, and (b) Parent may make
Distributions in the form of common stock.
(iv) FIXED CHARGE COVERAGE RATIO. Commencing April
30, 2005, the Company shall not permit the Fixed Charge Coverage Ratio, (a) to
be less than 1.0:1 as of the end of each April, July, October and January (each,
a "FISCAL QUARTER") ending prior to January 1, 2007, and (b) to be less than
1.05:1 as of the last day of each Fiscal Quarter ending thereafter. "FIXED
CHARGE COVERAGE RATIO" means for any period, the ratio of (i) EBITDA for such
period MINUS cash capital expenditures made (to the extent not already incurred
in a prior period) or incurred during such period, to (ii) the sum of (a)
interest expense, (b) principal payments required to be paid during such period
in respect of indebtedness, and (c) all federal, state, and local income taxes
accrued, all as determined for the twelve months ending on the determination
date for the Company and its subsidiaries on a consolidated basis without
duplication and in accordance with generally accepted accounting principles
consistently applied. "EBITDA" means, with respect to any fiscal period, the
Company's and its subsidiaries' consolidated net earnings (or loss), minus
extraordinary gains and interest income, plus interest expense, income taxes,
and depreciation and amortization for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(v) LEVERAGE RATIO. The Company shall not permit the
Leverage Ratio, as determined as of the end of each Fiscal Quarter, to be
greater than the amount set forth in the following table for the Fiscal Quarters
ending in the period set forth opposite thereto:
LEVERAGE RATIO Period
-------------- ------
4.50:1.0 04/30/05 - 10/30/05
4.30:1.0 10/31/05 - 10/30/06
4.00:1.0 10/31/06 - 10/30/07
3.80:1.0 10/31/07 - 10/30/08
"LEVERAGE RATIO" means, at any date of determination, the
ratio of (a) Total Debt at such date to (b) EBITDA for the applicable period
ending on such date. "TOTAL DEBT" means, as of any date of determination,
without duplication, the sum of (a) the outstanding aggregate amount of the
obligations for borrowed money, (b) the outstanding principal amount of capital
leases, (c) the outstanding principal amount of purchase money indebtedness, (d)
the outstanding principal amount of funded debt, and (e) the outstanding
principal amount of all obligations owing to GECC, DVI and USBPS; all as
determined for the Company and its subsidiaries on a consolidated basis without
duplication and in accordance with generally accepted accounting principles
consistently applied.
5
(vi) EBITDA MARGIN. The Company shall not permit the
EBITDA Margin to be less than 25% as of the end of any Fiscal Quarter ending on
or after April 30, 2005. "EBITDA MARGIN" means for any period, the ratio of (a)
EBITDA for such period, to (b) net revenues (excluding the professional service
fee component of radiology services) for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(vii) RECEIVABLE DAYS. The Company shall not permit
the Receivable Days to exceed 65 days as of the end of any Fiscal Quarter ending
on or after April 30, 2005. "RECEIVABLE DAYS" means for any period, a number
equal to (a) 365 divided by (b) the result of (i) net revenues for such period
divided by (ii) net receivables for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(viii) NAME CHANGES, ETC. The Company agrees that it
shall not change its name or jurisdiction of organization without giving 30 days
prior written notice to USBPS.
10. To induce USBPS on behalf of the Trustee to enter this
Agreement, the Guarantor hereby affirms and restates its Guarantee as related to
this Loan and AMENDED AND RESTATED RIDER A.
11. Radnet, the Company and the Guarantor each represent and
warrant that each has been represented by an attorney of its choice and is fully
aware of the terms contained in this Agreement and AMENDED AND RESTATED RIDER A
to which it is a party which was voluntarily entered into without coercion or
duress of any kind.
12. Radnet represents and warrants to USBPS on behalf of the
Noteholders and Trustee that all necessary actions on the part of Radnet to be
taken in connection with the execution, delivery and performance of this
Agreement have been taken; the performance by Radnet of this Agreement and the
AMENDED AND RESTATED RIDER A will not violate any of Radnet's Articles of
Incorporation, Articles of Formation, Partnership Agreement or other agreement
or law by which Radnet is bound.
6
13. Any notice, request, direction, consent, approval, waiver
or other communication required or permitted under this Agreement to be sent
must be in writing and will become effective only upon delivery to USBPS at the
address set forth herein as follows:
U.S. Bank Portfolio Services
0000 Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxx, XX 00000
Attn: Xxxx Xxx, Director of Operations
14. Except as provided herein, and in the AMENDED AND RESTATED
RIDER A, all of the other provisions of the Loan Documents not restated will
remain in effect.
15. This Agreement and the documents referenced herein
constitute the entire and final agreement among the parties with respect to the
subject matter hereof and there are no agreements, understandings, warranties or
representations among the parties with respect to these matters except as set
forth herein.
16. This Agreement will inure to the benefit of and bind the
parties and their respective successors and permitted assigns.
17. Neither this Agreement nor any of the provisions hereof
can be changed, waived, discharged or terminated except by an instrument in
writing signed by the parties against whom such enforcement of the change,
waiver, discharge or termination is sought.
18. This Agreement will be interpreted and construed under the
laws of the Commonwealth of Pennsylvania, regardless of the domicile of any
party and will be considered to have been made, executed and performed in
Pennsylvania.
7
19. THE UNDERSIGNED, AND SUBJECT TO THE PROVISIONS CONTAINED
HEREIN, USBPS FOR ITSELF AND AS AGENT FOR THE TRUSTEE, (A) AGREE TO SUBMIT FOR
THEMSELVES, IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT AND ANY
SCHEDULE OR FOR RECOGNITION AND ENFORCEMENT OF ANY JUDGMENT IN RESPECT HEREOF OR
THEREOF, TO THE EXCLUSIVE JURISDICTION OF THE COURTS OF THE COMONWEALTH OF
PENNSYLVANIA, THE COURTS OF THE UNITED STATES OF AMERICA FOR THE EASTERN
DISTRICT OF PENNSYLVANIA, AND APPELLATE COURTS FROM ANY THEREOF, (B) CONSENT
THAT ANY ACTION OR PROCEEDING SHALL BE BROUGHT IN SUCH COURTS, AND WAIVE ANY
OBJECTION THAT EACH MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH ACTION OR
PROCEEDING IN ANY SUCH COURT, (C) AGREE THAT SERVICE OF PROCESS OF ANY SUCH
ACTION OR PROCEEDING MAY BE EFFECTED BY CERTIFIED MAIL (OR ANY SUBSTANTIALLY
SIMILAR FORM OF MAIL), POSTAGE PREPAID, TO THE APPROPRIATE PARTY AT ITS ADDRESS
AS SET FORTH HEREIN, AND SERVICE MADE SHALL BE DEEMED TO BE COMPLETED UPON THE
EARLIER OF ACTUAL RECEIPT OR FIVE (5) DAYS AFTER THE SAME SHALL HAVE BEEN POSTED
AS AFORESAID, AND (D) AGREE THAT NOTHING HEREIN OR IN ANY EXHIBIT OR SCHEDULE
SHALL AFFECT THE RIGHT TO EFFECT SERVICE OF PROCESS IN ANY OTHER MANNER
PERMITTED BY LAW. USBPS AND THE UNDERSIGNED EACH HEREBY UNCONDITIONALLY WAIVES
ITS RIGHT TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING
OUT OF, DIRECTLY OR INDIRECTLY, THIS AGREEMENT, ANY EXHIBIT AND THE TRANSACTIONS
8
CONTEMPLATED HEREBY AND THEREBY, ANY OF THE RELATED DOCUMENTS, ANY DEALINGS
BETWEEN THE PARTIES HERETO RELATING TO THE SUBJECT MATTER HEREOF OR THEREOF,
AND/OR THE RELATIONSHIP THAT IS BEING ESTABLISHED BETWEEN USBPS AS AGENT FOR THE
TRUSTEE AND THE UNDERSIGNED, PROVIDED USBPS MAY IN ITS DISCRETION ENFORCE THE
TERMS OF THE FORUM SELECTION PROVISIONS IN THE LOANS.
20. Radnet, the Company and the Guarantor hereby release
USBPS, the Trustee, and the Noteholders from and against any claim, loss, or
damage arising out of the negotiation execution, and performance of the Loan or
related matters prior to the date hereof.
21. This Agreement may be executed in two or more counterparts
and each counterpart shall be deemed an original.
9
LYON FINANCIAL SERVICES, INC. DBA U.S. BANK
PORTFOLIO SERVICES, AS SUCCESSOR SERVICER
FOR DVI RECEIVABLES XVIII, L.L.C. AND AS
AGENT FOR U.S. BANK, N.A., AS TRUSTEE
By:________________________________________
RADNET MANAGEMENT, INC.
By:________________________________________
ACKNOWLEDGED AND AGREED TO:
Primedex Health Systems, Inc., Guarantor
By:________________________________________
10
AMENDMENT TO LOAN DOCUMENTS
---------------------------
AGREEMENT made as of June 30, 2004 ("AMENDMENT AGREEMENT" or
"AGREEMENT") by and between LYON FINANCIAL SERVICES, INC. DBA U.S. BANK
PORTFOLIO SERVICES, as Successor Servicer for DVI Receivables XIX, L.L.C. and as
Agent for U.S. Bank, N.A., as Trustee, with offices at 0000 Xxxxxx Xxxxxx, Xxxxx
000, Xxxxxxxx, Xxxxxxxxx 00000 ("USBPS") and Radnet Management, Inc., a
corporation, with offices at 0000 Xxxxxx Xxxxxx, Xxx Xxxxxxx, XX 00000
("RADNET"), and such other signatories hereto.
WHEREAS, on or about May 1, 2002, Radnet executed and
delivered to DVI Financial Services Inc. ("DVI") a Master Loan Agreement
collectively with the Amended and Restated Secured Promissory Note Number
#3502-002 dated July 2, 2002 (the "LOAN");
WHEREAS, to secure the payment of the Loan and all other
obligations of Radnet to DVI (collectively the "OBLIGATIONS"), Radnet, pursuant
to a Master Security Agreement dated on or about May 1, 2002 (the "SECURITY
AGREEMENT"), granted DVI a first priority security interest in certain
Collateral described therein;
WHEREAS, to further secure payment of the Note and all other
Obligations of Radnet to DVI, Radnet delivered to DVI the guarantee (the
"GUARANTEE") of Primedex Health Systems, Inc. (the "GUARANTOR") (the "GUARANTEE"
together with the Loan and ancillary documents are, collectively the "LOAN
DOCUMENTS");
WHEREAS, substantially contemporaneously therewith, DVI
contributed all of the Loan Documents to DVI Receivables XIX, L.L.C. ("DVI XIX")
and thereafter pursuant to an Amended and Restated Indenture, DVI XIX granted a
first priority security interest in and pledged all of the Loan Documents in
favor of U.S. Bank, N.A., as Trustee, for the benefit of a noteholder which
purchased asset backed promissory notes issued by DVI XIX (the "Noteholder");
WHEREAS, DVI contributed other Loans with Radnet or certain
affiliates of Radnet to this and other DVI securitizations (collectively the
"RELATED LOANS");
WHEREAS, Radnet is in default under the terms of the Loan;
WHEREAS, Radnet has requested USBPS to modify the Loan to
reflect an adjustment in payments;
WHEREAS, Radnet and/or certain of its affiliates have agreed
to modify the Related Loans;
WHEREAS, Radnet and certain of its affiliates are engaged in
negotiations to restructure or modify certain loan agreements, loans and
promissory notes with each of General Electric Capital Corporation ("GECC") and
DVI (with respect to GECC, the "GECC MODIFICATION", and with respect to DVI, the
"DVI MODIFICATION");
WHEREAS, subject to the following terms and conditions, USBPS
is willing to modify the Loan as hereinafter provided.
NOW, THEREFORE, the parties agree as follows:
1. All of the Whereas clauses are incorporated herein as if
hereinafter set forth at full length.
2. Radnet acknowledges that it is duly indebted to the Trustee
in the sum set forth on AMENDED AND RESTATED RIDER A annexed hereto, and has no
defenses, counterclaims or offsets to such indebtedness.
3. USBPS as Agent for the Trustee will modify the Loan to
provide for payments to commence in accordance with the attached revised payment
schedule (the "AMENDED AND RESTATED RIDER A"). Radnet may, at any time, prepay
all of the then outstanding Obligations subject to an additional prepayment fee
of 2% of such Obligations. Partial prepayments of the Obligations shall not be
permitted at any time.
2
4. This Agreement shall become effective upon the date that
USBPS receives this Agreement duly executed by Radnet and the satisfaction of
each of the following conditions:
(a) Radnet and/or its affiliates shall have entered
into agreements on similar terms to this Agreement and
otherwise in form and substance satisfactory to USBPS,
relating to the Related Loans (the "Related Loan
Modifications");
(b) reimbursement of USBPS's legal fees incurred in
connection with the execution of this Agreement and the
Related Loan Modifications, aggregating $50,000, shall have
been received by USBPS;
(c) Radnet and/or its affiliates shall have entered
into the GECC Modification and the DVI Modification.
5. The closing of the restructuring of the Radnet Loan is
further subject to delivery to USBPS of all of the following, each in form and
substance satisfactory to USBPS and its counsel:
(a) The executed AMENDED AND RESTATED RIDER A;
(b) An executed copy of this Agreement;
(c) Such other documents, including UCC financing
statements as USBPS reasonably requests.
6. Radnet hereby acknowledges and agrees that it has no, and
will not assert any, defenses, counterclaims or offsets to the Loan and AMENDED
AND RESTATED RIDER A and acknowledges and agrees that the Trustee holds a
first-priority security interest in the Collateral.
7. Any default or other breach of any obligation under the
GECC Modification, the DVI Modification, or any of the Related Loan
Modifications shall constitute a default under the Loan as modified by this
Agreement, and USBPS shall have all remedies thereunder.
3
8. Radnet hereby releases the Noteholder, USBPS individually
and as agent for the Trustee and the special purpose entities for which the
Trustee holds collateral, from and against any claims, loss or damage of any
kind or nature arising out of the Loan.
9. So long as any of the Obligations remain outstanding,
Radnet Management, Inc. (the "COMPANY") agrees as follows:
(i) FINANCIAL REPORTING. The Company shall furnish
the following documents or information to USBPS:
(A) Within 30 days after the end of each
Fiscal Quarter (as defined below) (i) (or 90 days in respect of the last month
of the fiscal year), the Company's consolidated, consolidating and on a center
by center basis, financial statements, including the most recent annual report,
balance sheet (not on a center by center basis) and income statement, prepared
in accordance with generally accepted accounting principles, which reports, the
Company warrants, shall fully and fairly represent the true financial condition
of the Company and (ii) updated projections for the Company and for each center;
(B) any other financial information normally
provided by the Company to the public; and
(C) Such other financial data or information
relative to this Amendment Agreement, including, without limitation, listings of
serial numbers or other identification data and confirmations of such
information, as USBPS may time-to-time reasonably request.
(ii) NO AMENDMENTS. Subsequent to the date of this
Amendment Agreement, the Company will not agree or consent to any amendments or
modifications to any agreement between the Company and DVI, GECC or Xxxxx Fargo
Foothill, Inc. ("FOOTHILL") containing terms (including, but not limited to,
increasing interest rates, accelerating the principal amortization or maturity,
new or more stringent defaults, additional collateral, and new remedies
provisions) that would be more onerous to the Company, or adversely impact or
affect GECC with respect to the terms of this Amendment Agreement.
(iii) DISTRIBUTIONS. The Company shall not make any
distribution or declare or pay any dividends (in cash or other property, other
than common stock) on, or purchase, acquire, redeem, or retire any of the
Company's stock, of any class, whether now or hereafter outstanding
(collectively, "DISTRIBUTIONS"); PROVIDED, HOWEVER, that so long as no default
shall have occurred and be continuing immediately prior to or after giving
4
effect to any such payment, (a) the Company may make Distributions to Primedex
Health Systems, Inc., a New York corporation (the "PARENT") (1) in amounts
necessary to pay customary expenses of Parent in the ordinary course of its
business as a public holding company (including salaries and related reasonable
and customary expenses incurred by employees of Parent) in an aggregate amount
not to exceed $750,000 in any fiscal year, (2) in amounts necessary to enable
Parent to pay taxes when due and owing by it in the ordinary course of its
business as a holding company and (3) in amounts necessary to enable Parent to
pay interest on those certain 11.5% Series A Convertible Subordinated Notes due
June 30, 2008, issued by Parent on June 25, 1993, and (b) Parent may make
Distributions in the form of common stock.
(iv) FIXED CHARGE COVERAGE RATIO. Commencing April
30, 2005, the Company shall not permit the Fixed Charge Coverage Ratio, (a) to
be less than 1.0:1 as of the end of each April, July, October and January (each,
a "FISCAL QUARTER") ending prior to January 1, 2007, and (b) to be less than
1.05:1 as of the last day of each Fiscal Quarter ending thereafter. "FIXED
CHARGE COVERAGE RATIO" means for any period, the ratio of (i) EBITDA for such
period MINUS cash capital expenditures made (to the extent not already incurred
in a prior period) or incurred during such period, to (ii) the sum of (a)
interest expense, (b) principal payments required to be paid during such period
in respect of indebtedness, and (c) all federal, state, and local income taxes
accrued, all as determined for the twelve months ending on the determination
date for the Company and its subsidiaries on a consolidated basis without
duplication and in accordance with generally accepted accounting principles
consistently applied. "EBITDA" means, with respect to any fiscal period, the
Company's and its subsidiaries' consolidated net earnings (or loss), minus
extraordinary gains and interest income, plus interest expense, income taxes,
and depreciation and amortization for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(v) LEVERAGE RATIO. The Company shall not permit the
Leverage Ratio, as determined as of the end of each Fiscal Quarter, to be
greater than the amount set forth in the following table for the Fiscal Quarters
ending in the period set forth opposite thereto:
LEVERAGE RATIO Period
-------------- ------
4.50:1.0 04/30/05 - 10/30/05
4.30:1.0 10/31/05 - 10/30/06
4.00:1.0 10/31/06 - 10/30/07
3.80:1.0 10/31/07 - 10/30/08
"LEVERAGE RATIO" means, at any date of determination, the
ratio of (a) Total Debt at such date to (b) EBITDA for the applicable period
ending on such date. "TOTAL DEBT" means, as of any date of determination,
without duplication, the sum of (a) the outstanding aggregate amount of the
obligations for borrowed money, (b) the outstanding principal amount of capital
leases, (c) the outstanding principal amount of purchase money indebtedness, (d)
the outstanding principal amount of funded debt, and (e) the outstanding
principal amount of all obligations owing to GECC, DVI and USBPS; all as
5
determined for the Company and its subsidiaries on a consolidated basis without
duplication and in accordance with generally accepted accounting principles
consistently applied.
(vi) EBITDA MARGIN. The Company shall not permit the
EBITDA Margin to be less than 25% as of the end of any Fiscal Quarter ending on
or after April 30, 2005. "EBITDA MARGIN" means for any period, the ratio of (a)
EBITDA for such period, to (b) net revenues (excluding the professional service
fee component of radiology services) for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(vii) RECEIVABLE DAYS. The Company shall not permit
the Receivable Days to exceed 65 days as of the end of any Fiscal Quarter ending
on or after April 30, 2005. "RECEIVABLE DAYS" means for any period, a number
equal to (a) 365 divided by (b) the result of (i) net revenues for such period
divided by (ii) net receivables for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(viii) NAME CHANGES, ETC. The Company agrees that it
shall not change its name or jurisdiction of organization without giving 30 days
prior written notice to USBPS.
10. To induce USBPS on behalf of the Trustee to enter this
Agreement, the Guarantor hereby affirms and restates its Guarantee as related to
this Loan and AMENDED AND RESTATED RIDER A.
11. Radnet, the Company and the Guarantor each represent and
warrant that each has been represented by an attorney of its choice and is fully
aware of the terms contained in this Agreement and AMENDED AND RESTATED RIDER A
to which it is a party which was voluntarily entered into without coercion or
duress of any kind.
12. Radnet represents and warrants to USBPS on behalf of the
Noteholders and Trustee that all necessary actions on the part of Radnet to be
taken in connection with the execution, delivery and performance of this
Agreement have been taken; the performance by Radnet of this Agreement and the
AMENDED AND RESTATED RIDER A will not violate any of Radnet's Articles of
Incorporation, Articles of Formation, Partnership Agreement or other agreement
or law by which Radnet is bound.
6
13. Any notice, request, direction, consent, approval, waiver
or other communication required or permitted under this Agreement to be sent
must be in writing and will become effective only upon delivery to USBPS at the
address set forth herein as follows:
U.S. Bank Portfolio Services
0000 Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxx, XX 00000
Attn: Xxxx Xxx, Director of Operations
14. Except as provided herein, and in the AMENDED AND RESTATED
RIDER A, all of the other provisions of the Loan Documents not restated will
remain in effect.
15. This Agreement and the documents referenced herein
constitute the entire and final agreement among the parties with respect to the
subject matter hereof and there are no agreements, understandings, warranties or
representations among the parties with respect to these matters except as set
forth herein.
16. This Agreement will inure to the benefit of and bind the
parties and their respective successors and permitted assigns.
17. Neither this Agreement nor any of the provisions hereof
can be changed, waived, discharged or terminated except by an instrument in
writing signed by the parties against whom such enforcement of the change,
waiver, discharge or termination is sought.
18. This Agreement will be interpreted and construed under the
laws of the Commonwealth of Pennsylvania, regardless of the domicile of any
party and will be considered to have been made, executed and performed in
Pennsylvania.
7
19. THE UNDERSIGNED, AND SUBJECT TO THE PROVISIONS CONTAINED
HEREIN, USBPS FOR ITSELF AND AS AGENT FOR THE TRUSTEE, (A) AGREE TO SUBMIT FOR
THEMSELVES, IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT AND ANY
SCHEDULE OR FOR RECOGNITION AND ENFORCEMENT OF ANY JUDGMENT IN RESPECT HEREOF OR
THEREOF, TO THE EXCLUSIVE JURISDICTION OF THE COURTS OF THE COMONWEALTH OF
PENNSYLVANIA, THE COURTS OF THE UNITED STATES OF AMERICA FOR THE EASTERN
DISTRICT OF PENNSYLVANIA, AND APPELLATE COURTS FROM ANY THEREOF, (B) CONSENT
THAT ANY ACTION OR PROCEEDING SHALL BE BROUGHT IN SUCH COURTS, AND WAIVE ANY
OBJECTION THAT EACH MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH ACTION OR
PROCEEDING IN ANY SUCH COURT, (C) AGREE THAT SERVICE OF PROCESS OF ANY SUCH
ACTION OR PROCEEDING MAY BE EFFECTED BY CERTIFIED MAIL (OR ANY SUBSTANTIALLY
SIMILAR FORM OF MAIL), POSTAGE PREPAID, TO THE APPROPRIATE PARTY AT ITS ADDRESS
AS SET FORTH HEREIN, AND SERVICE MADE SHALL BE DEEMED TO BE COMPLETED UPON THE
EARLIER OF ACTUAL RECEIPT OR FIVE (5) DAYS AFTER THE SAME SHALL HAVE BEEN POSTED
AS AFORESAID, AND (D) AGREE THAT NOTHING HEREIN OR IN ANY EXHIBIT OR SCHEDULE
SHALL AFFECT THE RIGHT TO EFFECT SERVICE OF PROCESS IN ANY OTHER MANNER
PERMITTED BY LAW. USBPS AND THE UNDERSIGNED EACH HEREBY UNCONDITIONALLY WAIVES
ITS RIGHT TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING
OUT OF, DIRECTLY OR INDIRECTLY, THIS AGREEMENT, ANY EXHIBIT AND THE TRANSACTIONS
8
CONTEMPLATED HEREBY AND THEREBY, ANY OF THE RELATED DOCUMENTS, ANY DEALINGS
BETWEEN THE PARTIES HERETO RELATING TO THE SUBJECT MATTER HEREOF OR THEREOF,
AND/OR THE RELATIONSHIP THAT IS BEING ESTABLISHED BETWEEN USBPS AS AGENT FOR THE
TRUSTEE AND THE UNDERSIGNED, PROVIDED USBPS MAY IN ITS DISCRETION ENFORCE THE
TERMS OF THE FORUM SELECTION PROVISIONS IN THE LOANS.
20. Radnet, the Company and the Guarantor hereby release
USBPS, the Trustee, and the Noteholders from and against any claim, loss, or
damage arising out of the negotiation execution, and performance of the Loan or
related matters prior to the date hereof.
21. This Agreement may be executed in two or more counterparts
and each counterpart shall be deemed an original.
9
LYON FINANCIAL SERVICES, INC. DBA U.S. BANK
PORTFOLIO SERVICES, AS SUCCESSOR SERVICER
FOR DVI RECEIVABLES XIX, L.L.C. AND AS AGENT
FOR U.S. BANK, N.A., AS TRUSTEE
By:_________________________________________
RADNET MANAGEMENT, INC.
By:_________________________________________
ACKNOWLEDGED AND AGREED TO:
Primedex Health Systems, Inc., Guarantor
By:_____________________________________
10
AMENDMENT TO LOAN DOCUMENTS
---------------------------
AGREEMENT made as of June 30, 2004 ("AMENDMENT AGREEMENT" or
"AGREEMENT") by and between LYON FINANCIAL SERVICES, INC. DBA U.S. BANK
PORTFOLIO SERVICES, as Successor Servicer for DVI Receivables XVIII, L.L.C. and
as Agent for U.S. Bank, N.A., as Trustee, with offices at 0000 Xxxxxx Xxxxxx,
Xxxxx 000, Xxxxxxxx, Xxxxxxxxx 00000 ("USBPS") and Radnet Management, Inc., a
corporation, with offices at 0000 Xxxxxx Xxxxxx, Xxx Xxxxxxx, XX 00000
("RADNET"), and such other signatories hereto.
WHEREAS, on or about May 1, 2002, Radnet executed and
delivered to DVI Financial Services Inc. ("DVI") a Master Loan Agreement
collectively with the Amended and Restated Secured Promissory Note Number
#3502-001 dated May 1, 2002 (the "LOAN");
WHEREAS, to secure the payment of the Loan and all other
obligations of Radnet to DVI (collectively the "OBLIGATIONS"), Radnet, pursuant
to a Master Security Agreement dated on or about May 1, 2002 (the "SECURITY
AGREEMENT"), granted DVI a first priority security interest in certain
Collateral described therein;
WHEREAS, to further secure payment of the Note and all other
Obligations of Radnet to DVI, Radnet delivered to DVI the guarantee (the
"GUARANTEE") of Primedex Health Systems, Inc. (the "GUARANTOR") (the "GUARANTEE"
together with the Loan and ancillary documents are, collectively the "LOAN
DOCUMENTS");
WHEREAS, substantially contemporaneously therewith, DVI
contributed all of the Loan Documents to DVI Receivables XVIII, L.L.C. ("DVI
XVIII") and thereafter pursuant to an Amended and Restated Indenture, DVI XVIII
granted a first priority security interest in and pledged all of the Loan
Documents in favor of U.S. Bank, N.A., as Trustee, for the benefit of a
noteholder which purchased asset backed promissory notes issued by DVI XVIII
(the "Noteholder");
WHEREAS, DVI contributed other Loans with Radnet or certain
affiliates of Radnet to this and other DVI securitizations (collectively the
"RELATED LOANS");
WHEREAS, Radnet is in default under the terms of the Loan;
WHEREAS, Radnet has requested USBPS to modify the Loan to
reflect an adjustment in payments;
WHEREAS, Radnet and/or certain of its affiliates have agreed
to modify the Related Loans;
WHEREAS, Radnet and certain of its affiliates are engaged in
negotiations to restructure or modify certain loan agreements, loans and
promissory notes with each of General Electric Capital Corporation ("GECC") and
DVI (with respect to GECC, the "GECC MODIFICATION", and with respect to DVI, the
"DVI MODIFICATION");
WHEREAS, subject to the following terms and conditions, USBPS
is willing to modify the Loan as hereinafter provided.
NOW, THEREFORE, the parties agree as follows:
1. All of the Whereas clauses are incorporated herein as if
hereinafter set forth at full length.
2. Radnet acknowledges that it is duly indebted to the Trustee
in the sum set forth on AMENDED AND RESTATED RIDER A annexed hereto, and has no
defenses, counterclaims or offsets to such indebtedness.
3. USBPS as Agent for the Trustee will modify the Loan to
provide for payments to commence in accordance with the attached revised payment
schedule (the "AMENDED AND RESTATED RIDER A"). Radnet may, at any time, prepay
all of the then outstanding Obligations subject to an additional prepayment fee
of 2% of such Obligations. Partial prepayments of the Obligations shall not be
permitted at any time.
2
4. This Agreement shall become effective upon the date that
USBPS receives this Agreement duly executed by Radnet and the satisfaction of
each of the following conditions:
(a) Radnet and/or its affiliates shall have entered
into agreements on similar terms to this Agreement and
otherwise in form and substance satisfactory to USBPS,
relating to the Related Loans (the "Related Loan
Modifications");
(b) reimbursement of USBPS's legal fees incurred in
connection with the execution of this Agreement and the
Related Loan Modifications, aggregating $50,000, shall have
been received by USBPS;
(c) Radnet and/or its affiliates shall have entered
into the GECC Modification and the DVI Modification.
5. The closing of the restructuring of the Radnet Loan is
further subject to delivery to USBPS of all of the following, each in form and
substance satisfactory to USBPS and its counsel:
(a) The executed AMENDED AND RESTATED RIDER A;
(b) An executed copy of this Agreement;
(c) Such other documents, including UCC financing
statements as USBPS reasonably requests.
6. Radnet hereby acknowledges and agrees that it has no, and
will not assert any, defenses, counterclaims or offsets to the Loan and AMENDED
AND RESTATED RIDER A and acknowledges and agrees that the Trustee holds a
first-priority security interest in the Collateral.
7. Any default or other breach of any obligation under the
GECC Modification, the DVI Modification, or any of the Related Loan
Modifications shall constitute a default under the Loan as modified by this
Agreement, and USBPS shall have all remedies thereunder.
3
8. Radnet hereby releases the Noteholder, USBPS individually
and as agent for the Trustee and the special purpose entities for which the
Trustee holds collateral, from and against any claims, loss or damage of any
kind or nature arising out of the Loan.
9. So long as any of the Obligations remain outstanding,
Radnet Management, Inc. (the "COMPANY") agrees as follows:
(i) FINANCIAL REPORTING. The Company shall furnish
the following documents or information to USBPS:
(A) Within 30 days after the end of each
Fiscal Quarter (as defined below) (i) (or 90 days in respect of the last month
of the fiscal year), the Company's consolidated, consolidating and on a center
by center basis, financial statements, including the most recent annual report,
balance sheet (not on a center by center basis) and income statement, prepared
in accordance with generally accepted accounting principles, which reports, the
Company warrants, shall fully and fairly represent the true financial condition
of the Company and (ii) updated projections for the Company and for each center;
(B) any other financial information normally
provided by the Company to the public; and
(C) Such other financial data or information
relative to this Amendment Agreement, including, without limitation, listings of
serial numbers or other identification data and confirmations of such
information, as USBPS may time-to-time reasonably request.
(ii) NO AMENDMENTS. Subsequent to the date of this
Amendment Agreement, the Company will not agree or consent to any amendments or
modifications to any agreement between the Company and DVI, GECC or Xxxxx Fargo
Foothill, Inc. ("FOOTHILL") containing terms (including, but not limited to,
increasing interest rates, accelerating the principal amortization or maturity,
new or more stringent defaults, additional collateral, and new remedies
provisions) that would be more onerous to the Company, or adversely impact or
affect GECC with respect to the terms of this Amendment Agreement.
(iii) DISTRIBUTIONS. The Company shall not make any
distribution or declare or pay any dividends (in cash or other property, other
than common stock) on, or purchase, acquire, redeem, or retire any of the
Company's stock, of any class, whether now or hereafter outstanding
(collectively, "DISTRIBUTIONS"); PROVIDED, HOWEVER, that so long as no default
shall have occurred and be continuing immediately prior to or after giving
4
effect to any such payment, (a) the Company may make Distributions to Primedex
Health Systems, Inc., a New York corporation (the "PARENT") (1) in amounts
necessary to pay customary expenses of Parent in the ordinary course of its
business as a public holding company (including salaries and related reasonable
and customary expenses incurred by employees of Parent) in an aggregate amount
not to exceed $750,000 in any fiscal year, (2) in amounts necessary to enable
Parent to pay taxes when due and owing by it in the ordinary course of its
business as a holding company and (3) in amounts necessary to enable Parent to
pay interest on those certain 11.5% Series A Convertible Subordinated Notes due
June 30, 2008, issued by Parent on June 25, 1993, and (b) Parent may make
Distributions in the form of common stock.
(iv) FIXED CHARGE COVERAGE RATIO. Commencing April
30, 2005, the Company shall not permit the Fixed Charge Coverage Ratio, (a) to
be less than 1.0:1 as of the end of each April, July, October and January (each,
a "FISCAL QUARTER") ending prior to January 1, 2007, and (b) to be less than
1.05:1 as of the last day of each Fiscal Quarter ending thereafter. "FIXED
CHARGE COVERAGE RATIO" means for any period, the ratio of (i) EBITDA for such
period MINUS cash capital expenditures made (to the extent not already incurred
in a prior period) or incurred during such period, to (ii) the sum of (a)
interest expense, (b) principal payments required to be paid during such period
in respect of indebtedness, and (c) all federal, state, and local income taxes
accrued, all as determined for the twelve months ending on the determination
date for the Company and its subsidiaries on a consolidated basis without
duplication and in accordance with generally accepted accounting principles
consistently applied. "EBITDA" means, with respect to any fiscal period, the
Company's and its subsidiaries' consolidated net earnings (or loss), minus
extraordinary gains and interest income, plus interest expense, income taxes,
and depreciation and amortization for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(v) LEVERAGE RATIO. The Company shall not permit the
Leverage Ratio, as determined as of the end of each Fiscal Quarter, to be
greater than the amount set forth in the following table for the Fiscal Quarters
ending in the period set forth opposite thereto:
LEVERAGE RATIO Period
-------------- ------
4.50:1.0 04/30/05 - 10/30/05
4.30:1.0 10/31/05 - 10/30/06
4.00:1.0 10/31/06 - 10/30/07
3.80:1.0 10/31/07 - 10/30/08
"LEVERAGE RATIO" means, at any date of determination, the
ratio of (a) Total Debt at such date to (b) EBITDA for the applicable period
ending on such date. "TOTAL DEBT" means, as of any date of determination,
without duplication, the sum of (a) the outstanding aggregate amount of the
obligations for borrowed money, (b) the outstanding principal amount of capital
leases, (c) the outstanding principal amount of purchase money indebtedness, (d)
the outstanding principal amount of funded debt, and (e) the outstanding
principal amount of all obligations owing to GECC, DVI and USBPS; all as
determined for the Company and its subsidiaries on a consolidated basis without
duplication and in accordance with generally accepted accounting principles
consistently applied.
5
(vi) EBITDA MARGIN. The Company shall not permit the
EBITDA Margin to be less than 25% as of the end of any Fiscal Quarter ending on
or after April 30, 2005. "EBITDA MARGIN" means for any period, the ratio of (a)
EBITDA for such period, to (b) net revenues (excluding the professional service
fee component of radiology services) for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(vii) RECEIVABLE DAYS. The Company shall not permit
the Receivable Days to exceed 65 days as of the end of any Fiscal Quarter ending
on or after April 30, 2005. "RECEIVABLE DAYS" means for any period, a number
equal to (a) 365 divided by (b) the result of (i) net revenues for such period
divided by (ii) net receivables for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(viii) NAME CHANGES, ETC. The Company agrees that it
shall not change its name or jurisdiction of organization without giving 30 days
prior written notice to USBPS.
10. To induce USBPS on behalf of the Trustee to enter this
Agreement, the Guarantor hereby affirms and restates its Guarantee as related to
this Loan and AMENDED AND RESTATED RIDER A.
11. Radnet, the Company and the Guarantor each represent and
warrant that each has been represented by an attorney of its choice and is fully
aware of the terms contained in this Agreement and AMENDED AND RESTATED RIDER A
to which it is a party which was voluntarily entered into without coercion or
duress of any kind.
12. Radnet represents and warrants to USBPS on behalf of the
Noteholders and Trustee that all necessary actions on the part of Radnet to be
taken in connection with the execution, delivery and performance of this
Agreement have been taken; the performance by Radnet of this Agreement and the
AMENDED AND RESTATED RIDER A will not violate any of Radnet's Articles of
Incorporation, Articles of Formation, Partnership Agreement or other agreement
or law by which Radnet is bound.
6
13. Any notice, request, direction, consent, approval, waiver
or other communication required or permitted under this Agreement to be sent
must be in writing and will become effective only upon delivery to USBPS at the
address set forth herein as follows:
U.S. Bank Portfolio Services
0000 Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxx, XX 00000
Attn: Xxxx Xxx, Director of Operations
14. Except as provided herein, and in the AMENDED AND RESTATED
RIDER A, all of the other provisions of the Loan Documents not restated will
remain in effect.
15. This Agreement and the documents referenced herein
constitute the entire and final agreement among the parties with respect to the
subject matter hereof and there are no agreements, understandings, warranties or
representations among the parties with respect to these matters except as set
forth herein.
16. This Agreement will inure to the benefit of and bind the
parties and their respective successors and permitted assigns.
17. Neither this Agreement nor any of the provisions hereof
can be changed, waived, discharged or terminated except by an instrument in
writing signed by the parties against whom such enforcement of the change,
waiver, discharge or termination is sought.
18. This Agreement will be interpreted and construed under the
laws of the Commonwealth of Pennsylvania, regardless of the domicile of any
party and will be considered to have been made, executed and performed in
Pennsylvania.
7
19. THE UNDERSIGNED, AND SUBJECT TO THE PROVISIONS CONTAINED
HEREIN, USBPS FOR ITSELF AND AS AGENT FOR THE TRUSTEE, (A) AGREE TO SUBMIT FOR
THEMSELVES, IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT AND ANY
SCHEDULE OR FOR RECOGNITION AND ENFORCEMENT OF ANY JUDGMENT IN RESPECT HEREOF OR
THEREOF, TO THE EXCLUSIVE JURISDICTION OF THE COURTS OF THE COMONWEALTH OF
PENNSYLVANIA, THE COURTS OF THE UNITED STATES OF AMERICA FOR THE EASTERN
DISTRICT OF PENNSYLVANIA, AND APPELLATE COURTS FROM ANY THEREOF, (B) CONSENT
THAT ANY ACTION OR PROCEEDING SHALL BE BROUGHT IN SUCH COURTS, AND WAIVE ANY
OBJECTION THAT EACH MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH ACTION OR
PROCEEDING IN ANY SUCH COURT, (C) AGREE THAT SERVICE OF PROCESS OF ANY SUCH
ACTION OR PROCEEDING MAY BE EFFECTED BY CERTIFIED MAIL (OR ANY SUBSTANTIALLY
SIMILAR FORM OF MAIL), POSTAGE PREPAID, TO THE APPROPRIATE PARTY AT ITS ADDRESS
AS SET FORTH HEREIN, AND SERVICE MADE SHALL BE DEEMED TO BE COMPLETED UPON THE
EARLIER OF ACTUAL RECEIPT OR FIVE (5) DAYS AFTER THE SAME SHALL HAVE BEEN POSTED
AS AFORESAID, AND (D) AGREE THAT NOTHING HEREIN OR IN ANY EXHIBIT OR SCHEDULE
SHALL AFFECT THE RIGHT TO EFFECT SERVICE OF PROCESS IN ANY OTHER MANNER
PERMITTED BY LAW. USBPS AND THE UNDERSIGNED EACH HEREBY UNCONDITIONALLY WAIVES
ITS RIGHT TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING
OUT OF, DIRECTLY OR INDIRECTLY, THIS AGREEMENT, ANY EXHIBIT AND THE TRANSACTIONS
8
CONTEMPLATED HEREBY AND THEREBY, ANY OF THE RELATED DOCUMENTS, ANY DEALINGS
BETWEEN THE PARTIES HERETO RELATING TO THE SUBJECT MATTER HEREOF OR THEREOF,
AND/OR THE RELATIONSHIP THAT IS BEING ESTABLISHED BETWEEN USBPS AS AGENT FOR THE
TRUSTEE AND THE UNDERSIGNED, PROVIDED USBPS MAY IN ITS DISCRETION ENFORCE THE
TERMS OF THE FORUM SELECTION PROVISIONS IN THE LOANS.
20. Radnet, the Company and the Guarantor hereby release
USBPS, the Trustee, and the Noteholders from and against any claim, loss, or
damage arising out of the negotiation execution, and performance of the Loan or
related matters prior to the date hereof.
21. This Agreement may be executed in two or more counterparts
and each counterpart shall be deemed an original.
9
LYON FINANCIAL SERVICES, INC. DBA U.S. BANK
PORTFOLIO SERVICES, AS SUCCESSOR SERVICER
FOR DVI RECEIVABLES XVIII, L.L.C. AND AS
AGENT FOR U.S. BANK, N.A., AS TRUSTEE
By:________________________________________
RADNET MANAGEMENT, INC.
By:________________________________________
ACKNOWLEDGED AND AGREED TO:
Primedex Health Systems, Inc., Guarantor
By:________________________________________
10
AMENDMENT TO LOAN DOCUMENTS
---------------------------
AGREEMENT made as of June 30, 2004 ("AMENDMENT AGREEMENT" or
"AGREEMENT") by and between LYON FINANCIAL SERVICES, INC. DBA U.S. BANK
PORTFOLIO SERVICES, as Servicer for DVI Receivables XV, L.L.C. and as Agent for
U.S. Bank, N.A., as Trustee, with offices at 0000 Xxxxxx Xxxxxx, Xxxxx 000,
Xxxxxxxx, Xxxxxxxxx 00000 ("USBPS") and Diagnostic Imaging Services, Inc., a
corporation, with offices at 00000 Xxxxxxxxx Xxx Xxx 000, Xxxxxxxx, XX 00000
("DIS"), and such other signatories hereto.
WHEREAS, on or about March 20, 2002, DIS executed and
delivered to DVI Financial Services Inc. ("DVI") a Master Loan Agreement
collectively with the Amended and Restated Secured Promissory Note Number
#3441-012 dated April 1, 2003 (the "LOAN");
WHEREAS, to secure the payment of the Loan and all other
obligations of DIS to DVI (collectively the "OBLIGATIONS"), DIS, pursuant to a
Master Security Agreement dated on or about March 20, 2002 (the "SECURITY
AGREEMENT"), granted DVI a first priority security interest in certain
Collateral described therein;
WHEREAS, to further secure payment of the Note and all other
Obligations of DIS to DVI, DIS delivered to DVI the guarantee (the "GUARANTEE")
of Primedex Health Systems, Inc. (the "GUARANTOR") (the "GUARANTEE" together
with the Loan and ancillary documents are, collectively the "LOAN DOCUMENTS");
WHEREAS, substantially contemporaneously therewith, DVI
contributed all of the Loan Documents to DVI Receivables XV, L.L.C. ("DVI XV")
and thereafter pursuant to an Amended and Restated Indenture, DVI XV granted a
first priority security interest in and pledged all of the Loan Documents in
favor of U.S. Bank, N.A., as Trustee, for the benefit of a noteholder which
purchased asset backed promissory notes issued by DVI XV (the "Noteholder");
WHEREAS, DVI contributed other Loans with DIS or certain
affiliates of DIS to this and other DVI securitizations (collectively the
"RELATED LOANS");
WHEREAS, DIS is in default under the terms of the Loan;
WHEREAS, DIS has requested USBPS to modify the Loan to reflect
an adjustment in payments;
WHEREAS, DIS and/or certain of its affiliates have agreed to
modify the Related Loans;
WHEREAS, DIS and certain of its affiliates are engaged in
negotiations to restructure or modify certain loan agreements, loans and
promissory notes with each of General Electric Capital Corporation ("GECC") and
DVI (with respect to GECC, the "GECC MODIFICATION", and with respect to DVI, the
"DVI MODIFICATION");
WHEREAS, subject to the following terms and conditions, USBPS
is willing to modify the Loan as hereinafter provided.
NOW, THEREFORE, the parties agree as follows:
1. All of the Whereas clauses are incorporated herein as if
hereinafter set forth at full length.
2. DIS acknowledges that it is duly indebted to the Trustee in
the sum set forth on AMENDED AND RESTATED RIDER A annexed hereto, and has no
defenses, counterclaims or offsets to such indebtedness.
3. USBPS as Agent for the Trustee will modify the Loan to
provide for payments to commence in accordance with the attached revised payment
schedule (the "AMENDED AND RESTATED RIDER A"). DIS may, at any time, prepay all
of the then outstanding Obligations subject to an additional prepayment fee of
2% of such Obligations. Partial prepayments of the Obligations shall not be
permitted at any time.
2
4. This Agreement shall become effective upon the date that
USBPS receives this Agreement duly executed by DIS and the satisfaction of each
of the following conditions:
(a) DIS and/or its affiliates shall have entered into
agreements on similar terms to this Agreement and otherwise in
form and substance satisfactory to USBPS, relating to the
Related Loans (the "Related Loan Modifications");
(b) reimbursement of USBPS's legal fees incurred in
connection with the execution of this Agreement and the
Related Loan Modifications, aggregating $50,000, shall have
been received by USBPS;
(c) DIS and/or its affiliates shall have entered into
the GECC Modification and the DVI Modification.
5. The closing of the restructuring of the DIS Loan is further
subject to delivery to USBPS of all of the following, each in form and substance
satisfactory to USBPS and its counsel: (a) The executed AMENDED AND RESTATED
RIDER A; (b) An executed copy of this Agreement; (c) Such other documents,
including UCC financing statements as USBPS reasonably requests.
6. DIS hereby acknowledges and agrees that it has no, and will
not assert any, defenses, counterclaims or offsets to the Loan and AMENDED AND
RESTATED RIDER A and acknowledges and agrees that the Trustee holds a
first-priority security interest in the Collateral.
7. Any default or other breach of any obligation under the
GECC Modification, the DVI Modification, or any of the Related Loan
Modifications shall constitute a default under the Loan as modified by this
Agreement, and USBPS shall have all remedies thereunder.
3
8. DIS hereby releases the Noteholder, USBPS individually and
as agent for the Trustee and the special purpose entities for which the Trustee
holds collateral, from and against any claims, loss or damage of any kind or
nature arising out of the Loan.
9. So long as any of the Obligations remain outstanding,
Radnet Management, Inc. (the "COMPANY") agrees as follows:
(i) FINANCIAL REPORTING. The Company shall furnish
the following documents or information to USBPS:
(A) Within 30 days after the end of each
Fiscal Quarter (as defined below) (i) (or 90 days in respect of the last month
of the fiscal year), the Company's consolidated, consolidating and on a center
by center basis, financial statements, including the most recent annual report,
balance sheet (not on a center by center basis) and income statement, prepared
in accordance with generally accepted accounting principles, which reports, the
Company warrants, shall fully and fairly represent the true financial condition
of the Company and (ii) updated projections for the Company and for each center;
(B) any other financial information normally
provided by the Company to the public; and
(C) Such other financial data or information
relative to this Amendment Agreement, including, without limitation, listings of
serial numbers or other identification data and confirmations of such
information, as USBPS may time-to-time reasonably request.
(ii) NO AMENDMENTS. Subsequent to the date of this
Amendment Agreement, the Company will not agree or consent to any amendments or
modifications to any agreement between the Company and DVI, GECC or Xxxxx Fargo
Foothill, Inc. ("FOOTHILL") containing terms (including, but not limited to,
increasing interest rates, accelerating the principal amortization or maturity,
new or more stringent defaults, additional collateral, and new remedies
provisions) that would be more onerous to the Company, or adversely impact or
affect GECC with respect to the terms of this Amendment Agreement.
(iii) DISTRIBUTIONS. The Company shall not make any
distribution or declare or pay any dividends (in cash or other property, other
than common stock) on, or purchase, acquire, redeem, or retire any of the
Company's stock, of any class, whether now or hereafter outstanding
(collectively, "DISTRIBUTIONS"); PROVIDED, HOWEVER, that so long as no default
shall have occurred and be continuing immediately prior to or after giving
4
effect to any such payment, (a) the Company may make Distributions to Primedex
Health Systems, Inc., a New York corporation (the "PARENT") (1) in amounts
necessary to pay customary expenses of Parent in the ordinary course of its
business as a public holding company (including salaries and related reasonable
and customary expenses incurred by employees of Parent) in an aggregate amount
not to exceed $750,000 in any fiscal year, (2) in amounts necessary to enable
Parent to pay taxes when due and owing by it in the ordinary course of its
business as a holding company and (3) in amounts necessary to enable Parent to
pay interest on those certain 11.5% Series A Convertible Subordinated Notes due
June 30, 2008, issued by Parent on June 25, 1993, and (b) Parent may make
Distributions in the form of common stock.
(iv) FIXED CHARGE COVERAGE RATIO. Commencing April
30, 2005, the Company shall not permit the Fixed Charge Coverage Ratio, (a) to
be less than 1.0:1 as of the end of each April, July, October and January (each,
a "FISCAL QUARTER") ending prior to January 1, 2007, and (b) to be less than
1.05:1 as of the last day of each Fiscal Quarter ending thereafter. "FIXED
CHARGE COVERAGE RATIO" means for any period, the ratio of (i) EBITDA for such
period MINUS cash capital expenditures made (to the extent not already incurred
in a prior period) or incurred during such period, to (ii) the sum of (a)
interest expense, (b) principal payments required to be paid during such period
in respect of indebtedness, and (c) all federal, state, and local income taxes
accrued, all as determined for the twelve months ending on the determination
date for the Company and its subsidiaries on a consolidated basis without
duplication and in accordance with generally accepted accounting principles
consistently applied. "EBITDA" means, with respect to any fiscal period, the
Company's and its subsidiaries' consolidated net earnings (or loss), minus
extraordinary gains and interest income, plus interest expense, income taxes,
and depreciation and amortization for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(v) LEVERAGE RATIO. The Company shall not permit the
Leverage Ratio, as determined as of the end of each Fiscal Quarter, to be
greater than the amount set forth in the following table for the Fiscal Quarters
ending in the period set forth opposite thereto:
LEVERAGE RATIO Period
-------------- ------
4.50:1.0 04/30/05 - 10/30/05
4.30:1.0 10/31/05 - 10/30/06
4.00:1.0 10/31/06 - 10/30/07
3.80:1.0 10/31/07 - 10/30/08
"LEVERAGE RATIO" means, at any date of determination, the
ratio of (a) Total Debt at such date to (b) EBITDA for the applicable period
ending on such date. "TOTAL DEBT" means, as of any date of determination,
without duplication, the sum of (a) the outstanding aggregate amount of the
obligations for borrowed money, (b) the outstanding principal amount of capital
leases, (c) the outstanding principal amount of purchase money indebtedness, (d)
the outstanding principal amount of funded debt, and (e) the outstanding
principal amount of all obligations owing to GECC, DVI and USBPS; all as
5
determined for the Company and its subsidiaries on a consolidated basis without
duplication and in accordance with generally accepted accounting principles
consistently applied.
(vi) EBITDA MARGIN. The Company shall not permit the
EBITDA Margin to be less than 25% as of the end of any Fiscal Quarter ending on
or after April 30, 2005. "EBITDA MARGIN" means for any period, the ratio of (a)
EBITDA for such period, to (b) net revenues (excluding the professional service
fee component of radiology services) for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(vii) RECEIVABLE DAYS. The Company shall not permit
the Receivable Days to exceed 65 days as of the end of any Fiscal Quarter ending
on or after April 30, 2005. "RECEIVABLE DAYS" means for any period, a number
equal to (a) 365 divided by (b) the result of (i) net revenues for such period
divided by (ii) net receivables for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(viii) NAME CHANGES, ETC. The Company agrees that it
shall not change its name or jurisdiction of organization without giving 30 days
prior written notice to USBPS.
10. To induce USBPS on behalf of the Trustee to enter this
Agreement, the Guarantor hereby affirms and restates its Guarantee as related to
this Loan and AMENDED AND RESTATED RIDER A.
11. DIS, the Company and the Guarantor each represent and
warrant that each has been represented by an attorney of its choice and is fully
aware of the terms contained in this Agreement and AMENDED AND RESTATED RIDER A
to which it is a party which was voluntarily entered into without coercion or
duress of any kind.
12. DIS represents and warrants to USBPS on behalf of the
Noteholders and Trustee that all necessary actions on the part of DIS to be
taken in connection with the execution, delivery and performance of this
Agreement have been taken; the performance by DIS of this Agreement and the
AMENDED AND RESTATED RIDER A will not violate any of DIS's Articles of
Incorporation, Articles of Formation, Partnership Agreement or other agreement
or law by which DIS is bound.
6
13. Any notice, request, direction, consent, approval, waiver
or other communication required or permitted under this Agreement to be sent
must be in writing and will become effective only upon delivery to USBPS at the
address set forth herein as follows:
U.S. Bank Portfolio Services
0000 Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxx, XX 00000
Attn: Xxxx Xxx, Director of Operations
14. Except as provided herein, and in the AMENDED AND RESTATED
RIDER A, all of the other provisions of the Loan Documents not restated will
remain in effect.
15. This Agreement and the documents referenced herein
constitute the entire and final agreement among the parties with respect to the
subject matter hereof and there are no agreements, understandings, warranties or
representations among the parties with respect to these matters except as set
forth herein.
16. This Agreement will inure to the benefit of and bind the
parties and their respective successors and permitted assigns.
17. Neither this Agreement nor any of the provisions hereof
can be changed, waived, discharged or terminated except by an instrument in
writing signed by the parties against whom such enforcement of the change,
waiver, discharge or termination is sought.
18. This Agreement will be interpreted and construed under the
laws of the Commonwealth of Pennsylvania, regardless of the domicile of any
party and will be considered to have been made, executed and performed in
Pennsylvania.
7
19. THE UNDERSIGNED, AND SUBJECT TO THE PROVISIONS CONTAINED
HEREIN, USBPS FOR ITSELF AND AS AGENT FOR THE TRUSTEE, (A) AGREE TO SUBMIT FOR
THEMSELVES, IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT AND ANY
SCHEDULE OR FOR RECOGNITION AND ENFORCEMENT OF ANY JUDGMENT IN RESPECT HEREOF OR
THEREOF, TO THE EXCLUSIVE JURISDICTION OF THE COURTS OF THE COMONWEALTH OF
PENNSYLVANIA, THE COURTS OF THE UNITED STATES OF AMERICA FOR THE EASTERN
DISTRICT OF PENNSYLVANIA, AND APPELLATE COURTS FROM ANY THEREOF, (B) CONSENT
THAT ANY ACTION OR PROCEEDING SHALL BE BROUGHT IN SUCH COURTS, AND WAIVE ANY
OBJECTION THAT EACH MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH ACTION OR
PROCEEDING IN ANY SUCH COURT, (C) AGREE THAT SERVICE OF PROCESS OF ANY SUCH
ACTION OR PROCEEDING MAY BE EFFECTED BY CERTIFIED MAIL (OR ANY SUBSTANTIALLY
SIMILAR FORM OF MAIL), POSTAGE PREPAID, TO THE APPROPRIATE PARTY AT ITS ADDRESS
AS SET FORTH HEREIN, AND SERVICE MADE SHALL BE DEEMED TO BE COMPLETED UPON THE
EARLIER OF ACTUAL RECEIPT OR FIVE (5) DAYS AFTER THE SAME SHALL HAVE BEEN POSTED
AS AFORESAID, AND (D) AGREE THAT NOTHING HEREIN OR IN ANY EXHIBIT OR SCHEDULE
SHALL AFFECT THE RIGHT TO EFFECT SERVICE OF PROCESS IN ANY OTHER MANNER
PERMITTED BY LAW. USBPS AND THE UNDERSIGNED EACH HEREBY UNCONDITIONALLY WAIVES
ITS RIGHT TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING
OUT OF, DIRECTLY OR INDIRECTLY, THIS AGREEMENT, ANY EXHIBIT AND THE TRANSACTIONS
8
CONTEMPLATED HEREBY AND THEREBY, ANY OF THE RELATED DOCUMENTS, ANY DEALINGS
BETWEEN THE PARTIES HERETO RELATING TO THE SUBJECT MATTER HEREOF OR THEREOF,
AND/OR THE RELATIONSHIP THAT IS BEING ESTABLISHED BETWEEN USBPS AS AGENT FOR THE
TRUSTEE AND THE UNDERSIGNED, PROVIDED USBPS MAY IN ITS DISCRETION ENFORCE THE
TERMS OF THE FORUM SELECTION PROVISIONS IN THE LOANS.
20. DIS, the Company and the Guarantor hereby release USBPS,
the Trustee, and the Noteholders from and against any claim, loss, or damage
arising out of the negotiation execution, and performance of the Loan or related
matters prior to the date hereof.
21. This Agreement may be executed in two or more counterparts
and each counterpart shall be deemed an original.
9
LYON FINANCIAL SERVICES, INC. DBA U.S. BANK
PORTFOLIO SERVICES, AS SERVICER FOR DVI
RECEIVABLES XV, L.L.C. AND AS AGENT FOR U.S.
BANK, N.A., AS TRUSTEE
By:_________________________________________
DIAGNOSTIC IMAGING SERVICES, INC.
By:_________________________________________
RADNET MANAGEMENT, INC.
By:_________________________________________
ACKNOWLEDGED AND AGREED TO:
Primedex Health Systems, Inc., Guarantor
By:_________________________________________
10
AMENDMENT TO LOAN DOCUMENTS
---------------------------
AGREEMENT made as of June 30, 2004 ("AMENDMENT AGREEMENT" or
"AGREEMENT") by and between LYON FINANCIAL SERVICES, INC. DBA U.S. BANK
PORTFOLIO SERVICES, as Successor Servicer for DVI Receivables XVIII, L.L.C. and
as Agent for U.S. Bank, N.A., as Trustee, with offices at 0000 Xxxxxx Xxxxxx,
Xxxxx 000, Xxxxxxxx, Xxxxxxxxx 00000 ("USBPS") and Diagnostic Imaging Services,
Inc., a corporation, with offices at 0000 Xxxxxx Xxxxxx, Xxx Xxxxxxx, XX 00000
("DIS"), and such other signatories hereto.
WHEREAS, on or about March 20, 2002, DIS executed and
delivered to DVI Financial Services Inc. ("DVI") a Master Loan Agreement
collectively with the Secured Promissory Note Number #3441-008 dated September
24, 2002 (the "LOAN");
WHEREAS, to secure the payment of the Loan and all other
obligations of DIS to DVI (collectively the "OBLIGATIONS"), DIS, pursuant to a
Master Security Agreement dated on or about March 20, 2002 (the "SECURITY
AGREEMENT"), granted DVI a first priority security interest in certain
Collateral described therein;
WHEREAS, to further secure payment of the Note and all other
Obligations of DIS to DVI, DIS delivered to DVI the guarantee (the "GUARANTEE")
of Primedex Health Systems, Inc. (the "GUARANTOR") (the "GUARANTEE" together
with the Loan and ancillary documents are, collectively the "LOAN DOCUMENTS");
WHEREAS, substantially contemporaneously therewith, DVI
contributed all of the Loan Documents to DVI Receivables XVIII, L.L.C. ("DVI
XVIII") and thereafter pursuant to an Amended and Restated Indenture, DVI XVIII
granted a first priority security interest in and pledged all of the Loan
Documents in favor of U.S. Bank, N.A., as Trustee, for the benefit of a
noteholder which purchased asset backed promissory notes issued by DVI XVIII
(the "Noteholder");
WHEREAS, DVI contributed other Loans with DIS or certain
affiliates of DIS to this and other DVI securitizations (collectively the
"RELATED LOANS");
WHEREAS, DIS is in default under the terms of the Loan;
WHEREAS, DIS has requested USBPS to modify the Loan to reflect
an adjustment in payments;
WHEREAS, DIS and/or certain of its affiliates have agreed to
modify the Related Loans;
WHEREAS, DIS and certain of its affiliates are engaged in
negotiations to restructure or modify certain loan agreements, loans and
promissory notes with each of General Electric Capital Corporation ("GECC") and
DVI (with respect to GECC, the "GECC MODIFICATION", and with respect to DVI, the
"DVI MODIFICATION");
WHEREAS, subject to the following terms and conditions, USBPS
is willing to modify the Loan as hereinafter provided.
NOW, THEREFORE, the parties agree as follows:
1. All of the Whereas clauses are incorporated herein as if
hereinafter set forth at full length.
2. DIS acknowledges that it is duly indebted to the Trustee in
the sum set forth on AMENDED AND RESTATED RIDER A annexed hereto, and has no
defenses, counterclaims or offsets to such indebtedness.
3. USBPS as Agent for the Trustee will modify the Loan to
provide for payments to commence in accordance with the attached revised payment
schedule (the "AMENDED AND RESTATED RIDER A"). DIS may, at any time, prepay all
of the then outstanding Obligations subject to an additional prepayment fee of
2
2% of such Obligations. Partial prepayments of the Obligations shall not be
permitted at any time.
4. This Agreement shall become effective upon the date that
USBPS receives this Agreement duly executed by DIS and the satisfaction of each
of the following conditions:
(a) DIS and/or its affiliates shall have entered into
agreements on similar terms to this Agreement and otherwise in
form and substance satisfactory to USBPS, relating to the
Related Loans (the "Related Loan Modifications");
(b) reimbursement of USBPS's legal fees incurred in
connection with the execution of this Agreement and the
Related Loan Modifications, aggregating $50,000, shall have
been received by USBPS;
(c) DIS and/or its affiliates shall have entered into
the GECC Modification and the DVI Modification.
5. The closing of the restructuring of the DIS Loan is further
subject to delivery to USBPS of all of the following, each in form and substance
satisfactory to USBPS and its counsel:
(a) The executed AMENDED AND RESTATED RIDER A;
(b) An executed copy of this Agreement;
(c) Such other documents, including UCC financing
statements as USBPS reasonably requests.
6. DIS hereby acknowledges and agrees that it has no, and will
not assert any, defenses, counterclaims or offsets to the Loan and AMENDED AND
RESTATED RIDER A and acknowledges and agrees that the Trustee holds a
first-priority security interest in the Collateral.
7. Any default or other breach of any obligation under the
GECC Modification, the DVI Modification, or any of the Related Loan
Modifications shall constitute a default under the Loan as modified by this
Agreement, and USBPS shall have all remedies thereunder.
3
8. DIS hereby releases the Noteholder, USBPS individually and
as agent for the Trustee and the special purpose entities for which the Trustee
holds collateral, from and against any claims, loss or damage of any kind or
nature arising out of the Loan.
9. So long as any of the Obligations remain outstanding,
Radnet Management, Inc. (the "COMPANY") agrees as follows:
(i) FINANCIAL REPORTING. The Company shall furnish
the following documents or information to USBPS:
(A) Within 30 days after the end of each
Fiscal Quarter (as defined below) (i) (or 90 days in respect of the last month
of the fiscal year), the Company's consolidated, consolidating and on a center
by center basis, financial statements, including the most recent annual report,
balance sheet (not on a center by center basis) and income statement, prepared
in accordance with generally accepted accounting principles, which reports, the
Company warrants, shall fully and fairly represent the true financial condition
of the Company and (ii) updated projections for the Company and for each center;
(B) any other financial information normally
provided by the Company to the public; and
(C) Such other financial data or information
relative to this Amendment Agreement, including, without limitation, listings of
serial numbers or other identification data and confirmations of such
information, as USBPS may time-to-time reasonably request.
(ii) NO AMENDMENTS. Subsequent to the date of this
Amendment Agreement, the Company will not agree or consent to any amendments or
modifications to any agreement between the Company and DVI, GECC or Xxxxx Fargo
Foothill, Inc. ("FOOTHILL") containing terms (including, but not limited to,
increasing interest rates, accelerating the principal amortization or maturity,
new or more stringent defaults, additional collateral, and new remedies
provisions) that would be more onerous to the Company, or adversely impact or
affect GECC with respect to the terms of this Amendment Agreement.
(iii) DISTRIBUTIONS. The Company shall not make any
distribution or declare or pay any dividends (in cash or other property, other
than common stock) on, or purchase, acquire, redeem, or retire any of the
Company's stock, of any class, whether now or hereafter outstanding
(collectively, "DISTRIBUTIONS"); PROVIDED, HOWEVER, that so long as no default
shall have occurred and be continuing immediately prior to or after giving
4
effect to any such payment, (a) the Company may make Distributions to Primedex
Health Systems, Inc., a New York corporation (the "PARENT") (1) in amounts
necessary to pay customary expenses of Parent in the ordinary course of its
business as a public holding company (including salaries and related reasonable
and customary expenses incurred by employees of Parent) in an aggregate amount
not to exceed $750,000 in any fiscal year, (2) in amounts necessary to enable
Parent to pay taxes when due and owing by it in the ordinary course of its
business as a holding company and (3) in amounts necessary to enable Parent to
pay interest on those certain 11.5% Series A Convertible Subordinated Notes due
June 30, 2008, issued by Parent on June 25, 1993, and (b) Parent may make
Distributions in the form of common stock.
(iv) FIXED CHARGE COVERAGE RATIO. Commencing April
30, 2005, the Company shall not permit the Fixed Charge Coverage Ratio, (a) to
be less than 1.0:1 as of the end of each April, July, October and January (each,
a "FISCAL QUARTER") ending prior to January 1, 2007, and (b) to be less than
1.05:1 as of the last day of each Fiscal Quarter ending thereafter. "FIXED
CHARGE COVERAGE RATIO" means for any period, the ratio of (i) EBITDA for such
period MINUS cash capital expenditures made (to the extent not already incurred
in a prior period) or incurred during such period, to (ii) the sum of (a)
interest expense, (b) principal payments required to be paid during such period
in respect of indebtedness, and (c) all federal, state, and local income taxes
accrued, all as determined for the twelve months ending on the determination
date for the Company and its subsidiaries on a consolidated basis without
duplication and in accordance with generally accepted accounting principles
consistently applied. "EBITDA" means, with respect to any fiscal period, the
Company's and its subsidiaries' consolidated net earnings (or loss), minus
extraordinary gains and interest income, plus interest expense, income taxes,
and depreciation and amortization for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(v) LEVERAGE RATIO. The Company shall not permit the
Leverage Ratio, as determined as of the end of each Fiscal Quarter, to be
greater than the amount set forth in the following table for the Fiscal Quarters
ending in the period set forth opposite thereto:
LEVERAGE RATIO Period
-------------- ------
4.50:1.0 04/30/05 - 10/30/05
4.30:1.0 10/31/05 - 10/30/06
4.00:1.0 10/31/06 - 10/30/07
3.80:1.0 10/31/07 - 10/30/08
"LEVERAGE RATIO" means, at any date of determination, the
ratio of (a) Total Debt at such date to (b) EBITDA for the applicable period
ending on such date. "TOTAL DEBT" means, as of any date of determination,
without duplication, the sum of (a) the outstanding aggregate amount of the
obligations for borrowed money, (b) the outstanding principal amount of capital
leases, (c) the outstanding principal amount of purchase money indebtedness, (d)
the outstanding principal amount of funded debt, and (e) the outstanding
5
principal amount of all obligations owing to GECC, DVI and USBPS; all as
determined for the Company and its subsidiaries on a consolidated basis without
duplication and in accordance with generally accepted accounting principles
consistently applied.
(vi) EBITDA MARGIN. The Company shall not permit the
EBITDA Margin to be less than 25% as of the end of any Fiscal Quarter ending on
or after April 30, 2005. "EBITDA MARGIN" means for any period, the ratio of (a)
EBITDA for such period, to (b) net revenues (excluding the professional service
fee component of radiology services) for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(vii) RECEIVABLE DAYS. The Company shall not permit
the Receivable Days to exceed 65 days as of the end of any Fiscal Quarter ending
on or after April 30, 2005. "RECEIVABLE DAYS" means for any period, a number
equal to (a) 365 divided by (b) the result of (i) net revenues for such period
divided by (ii) net receivables for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(viii) NAME CHANGES, ETC. The Company agrees that it
shall not change its name or jurisdiction of organization without giving 30 days
prior written notice to USBPS.
10. To induce USBPS on behalf of the Trustee to enter this
Agreement, the Guarantor hereby affirms and restates its Guarantee as related to
this Loan and AMENDED AND RESTATED RIDER A.
11. DIS, the Company and the Guarantor each represent and
warrant that each has been represented by an attorney of its choice and is fully
aware of the terms contained in this Agreement and AMENDED AND RESTATED RIDER A
to which it is a party which was voluntarily entered into without coercion or
duress of any kind.
12. DIS represents and warrants to USBPS on behalf of the
Noteholders and Trustee that all necessary actions on the part of DIS to be
taken in connection with the execution, delivery and performance of this
Agreement have been taken; the performance by DIS of this Agreement and the
AMENDED AND RESTATED RIDER A will not violate any of DIS's Articles of
Incorporation, Articles of Formation, Partnership Agreement or other agreement
or law by which DIS is bound.
6
13. Any notice, request, direction, consent, approval, waiver
or other communication required or permitted under this Agreement to be sent
must be in writing and will become effective only upon delivery to USBPS at the
address set forth herein as follows:
U.S. Bank Portfolio Services
0000 Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxx, XX 00000
Attn: Xxxx Xxx, Director of Operations
14. Except as provided herein, and in the AMENDED AND RESTATED
RIDER A, all of the other provisions of the Loan Documents not restated will
remain in effect.
15. This Agreement and the documents referenced herein
constitute the entire and final agreement among the parties with respect to the
subject matter hereof and there are no agreements, understandings, warranties or
representations among the parties with respect to these matters except as set
forth herein.
16. This Agreement will inure to the benefit of and bind the
parties and their respective successors and permitted assigns.
17. Neither this Agreement nor any of the provisions hereof
can be changed, waived, discharged or terminated except by an instrument in
writing signed by the parties against whom such enforcement of the change,
waiver, discharge or termination is sought.
18. This Agreement will be interpreted and construed under the
laws of the Commonwealth of Pennsylvania, regardless of the domicile of any
party and will be considered to have been made, executed and performed in
Pennsylvania.
7
19. THE UNDERSIGNED, AND SUBJECT TO THE PROVISIONS CONTAINED
HEREIN, USBPS FOR ITSELF AND AS AGENT FOR THE TRUSTEE, (A) AGREE TO SUBMIT FOR
THEMSELVES, IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT AND ANY
SCHEDULE OR FOR RECOGNITION AND ENFORCEMENT OF ANY JUDGMENT IN RESPECT HEREOF OR
THEREOF, TO THE EXCLUSIVE JURISDICTION OF THE COURTS OF THE COMONWEALTH OF
PENNSYLVANIA, THE COURTS OF THE UNITED STATES OF AMERICA FOR THE EASTERN
DISTRICT OF PENNSYLVANIA, AND APPELLATE COURTS FROM ANY THEREOF, (B) CONSENT
THAT ANY ACTION OR PROCEEDING SHALL BE BROUGHT IN SUCH COURTS, AND WAIVE ANY
OBJECTION THAT EACH MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH ACTION OR
PROCEEDING IN ANY SUCH COURT, (C) AGREE THAT SERVICE OF PROCESS OF ANY SUCH
ACTION OR PROCEEDING MAY BE EFFECTED BY CERTIFIED MAIL (OR ANY SUBSTANTIALLY
SIMILAR FORM OF MAIL), POSTAGE PREPAID, TO THE APPROPRIATE PARTY AT ITS ADDRESS
AS SET FORTH HEREIN, AND SERVICE MADE SHALL BE DEEMED TO BE COMPLETED UPON THE
EARLIER OF ACTUAL RECEIPT OR FIVE (5) DAYS AFTER THE SAME SHALL HAVE BEEN POSTED
AS AFORESAID, AND (D) AGREE THAT NOTHING HEREIN OR IN ANY EXHIBIT OR SCHEDULE
SHALL AFFECT THE RIGHT TO EFFECT SERVICE OF PROCESS IN ANY OTHER MANNER
PERMITTED BY LAW. USBPS AND THE UNDERSIGNED EACH HEREBY UNCONDITIONALLY WAIVES
ITS RIGHT TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING
OUT OF, DIRECTLY OR INDIRECTLY, THIS AGREEMENT, ANY EXHIBIT AND THE TRANSACTIONS
8
CONTEMPLATED HEREBY AND THEREBY, ANY OF THE RELATED DOCUMENTS, ANY DEALINGS
BETWEEN THE PARTIES HERETO RELATING TO THE SUBJECT MATTER HEREOF OR THEREOF,
AND/OR THE RELATIONSHIP THAT IS BEING ESTABLISHED BETWEEN USBPS AS AGENT FOR THE
TRUSTEE AND THE UNDERSIGNED, PROVIDED USBPS MAY IN ITS DISCRETION ENFORCE THE
TERMS OF THE FORUM SELECTION PROVISIONS IN THE LOANS.
20. DIS, the Company and the Guarantor hereby release USBPS,
the Trustee, and the Noteholders from and against any claim, loss, or damage
arising out of the negotiation execution, and performance of the Loan or related
matters prior to the date hereof.
21. This Agreement may be executed in two or more counterparts
and each counterpart shall be deemed an original.
9
LYON FINANCIAL SERVICES, INC. DBA U.S. BANK
PORTFOLIO SERVICES, AS SUCCESSOR SERVICER
FOR DVI RECEIVABLES XVIII, L.L.C. AND AS
AGENT FOR U.S. BANK, N.A., AS TRUSTEE
By:_________________________________________
DIAGNOSTIC IMAGING SERVICES, INC.
By:_________________________________________
RADNET MANAGEMENT, INC.
By:_________________________________________
ACKNOWLEDGED AND AGREED TO:
Primedex Health Systems, Inc., Guarantor
By:_________________________________________
10
AMENDMENT TO LOAN DOCUMENTS
---------------------------
AGREEMENT made as of June 30, 2004 ("AMENDMENT AGREEMENT" or
"AGREEMENT") by and between LYON FINANCIAL SERVICES, INC. DBA U.S. BANK
PORTFOLIO SERVICES, as Successor Servicer for DVI Receivables XVIII, L.L.C. and
as Agent for U.S. Bank, N.A., as Trustee, with offices at 0000 Xxxxxx Xxxxxx,
Xxxxx 000, Xxxxxxxx, Xxxxxxxxx 00000 ("USBPS") and Diagnostic Imaging Services,
Inc., a corporation, with offices at 0000 Xxxxxx Xxxxxx, Xxx Xxxxxxx, XX 00000
("DIS"), and such other signatories hereto.
WHEREAS, on or about March 20, 2002, DIS executed and
delivered to DVI Financial Services Inc. ("DVI") a Master Loan Agreement
collectively with the Amended and Restated Secured Promissory Note Number
#3441-005 dated July 2, 2002 (the "LOAN");
WHEREAS, to secure the payment of the Loan and all other
obligations of DIS to DVI (collectively the "OBLIGATIONS"), DIS, pursuant to a
Master Security Agreement dated on or about March 20, 2002 (the "SECURITY
AGREEMENT"), granted DVI a first priority security interest in certain
Collateral described therein;
WHEREAS, to further secure payment of the Note and all other
Obligations of DIS to DVI, DIS delivered to DVI the guarantee (the "GUARANTEE")
of Primedex Health Systems, Inc. (the "GUARANTOR") (the "GUARANTEE" together
with the Loan and ancillary documents are, collectively the "LOAN DOCUMENTS");
WHEREAS, substantially contemporaneously therewith, DVI
contributed all of the Loan Documents to DVI Receivables XVIII, L.L.C. ("DVI
XVIII") and thereafter pursuant to an Amended and Restated Indenture, DVI XVIII
granted a first priority security interest in and pledged all of the Loan
Documents in favor of U.S. Bank, N.A., as Trustee, for the benefit of a
noteholder which purchased asset backed promissory notes issued by DVI XVIII
(the "Noteholder");
WHEREAS, DVI contributed other Loans with DIS or certain
affiliates of DIS to this and other DVI securitizations (collectively the
"RELATED LOANS");
WHEREAS, DIS is in default under the terms of the Loan;
WHEREAS, DIS has requested USBPS to modify the Loan to reflect
an adjustment in payments;
WHEREAS, DIS and/or certain of its affiliates have agreed to
modify the Related Loans;
WHEREAS, DIS and certain of its affiliates are engaged in
negotiations to restructure or modify certain loan agreements, loans and
promissory notes with each of General Electric Capital Corporation ("GECC") and
DVI (with respect to GECC, the "GECC MODIFICATION", and with respect to DVI, the
"DVI MODIFICATION");
WHEREAS, subject to the following terms and conditions, USBPS
is willing to modify the Loan as hereinafter provided.
NOW, THEREFORE, the parties agree as follows:
1. All of the Whereas clauses are incorporated herein as if
hereinafter set forth at full length.
2. DIS acknowledges that it is duly indebted to the Trustee in
the sum set forth on AMENDED AND RESTATED RIDER A annexed hereto, and has no
defenses, counterclaims or offsets to such indebtedness.
3. USBPS as Agent for the Trustee will modify the Loan to
provide for payments to commence in accordance with the attached revised payment
schedule (the "AMENDED AND RESTATED RIDER A"). DIS may, at any time, prepay all
2
of the then outstanding Obligations subject to an additional prepayment fee of
2% of such Obligations. Partial prepayments of the Obligations shall not be
permitted at any time.
4. This Agreement shall become effective upon the date that
USBPS receives this Agreement duly executed by DIS and the satisfaction of each
of the following conditions:
(a) DIS and/or its affiliates shall have entered into
agreements on similar terms to this Agreement and otherwise in
form and substance satisfactory to USBPS, relating to the
Related Loans (the "Related Loan Modifications");
(b) reimbursement of USBPS's legal fees incurred in
connection with the execution of this Agreement and the
Related Loan Modifications, aggregating $50,000, shall have
been received by USBPS;
(c) DIS and/or its affiliates shall have entered into
the GECC Modification and the DVI Modification.
5. The closing of the restructuring of the DIS Loan is further
subject to delivery to USBPS of all of the following, each in form and substance
satisfactory to USBPS and its counsel:
(a) The executed AMENDED AND RESTATED RIDER A;
(b) An executed copy of this Agreement;
(c) Such other documents, including UCC financing
statements as USBPS reasonably requests.
6. DIS hereby acknowledges and agrees that it has no, and will
not assert any, defenses, counterclaims or offsets to the Loan and AMENDED AND
RESTATED RIDER A and acknowledges and agrees that the Trustee holds a
first-priority security interest in the Collateral.
7. Any default or other breach of any obligation under the
GECC Modification, the DVI Modification, or any of the Related Loan
Modifications shall constitute a default under the Loan as modified by this
Agreement, and USBPS shall have all remedies thereunder.
3
8. DIS hereby releases the Noteholder, USBPS individually and
as agent for the Trustee and the special purpose entities for which the Trustee
holds collateral, from and against any claims, loss or damage of any kind or
nature arising out of the Loan.
9. So long as any of the Obligations remain outstanding,
Radnet Management, Inc. (the "COMPANY") agrees as follows:
(i) FINANCIAL REPORTING. The Company shall furnish
the following documents or information to USBPS:
(A) Within 30 days after the end of each
Fiscal Quarter (as defined below) (i) (or 90 days in respect of the last month
of the fiscal year), the Company's consolidated, consolidating and on a center
by center basis, financial statements, including the most recent annual report,
balance sheet (not on a center by center basis) and income statement, prepared
in accordance with generally accepted accounting principles, which reports, the
Company warrants, shall fully and fairly represent the true financial condition
of the Company and (ii) updated projections for the Company and for each center;
(B) any other financial information normally
provided by the Company to the public; and
(C) Such other financial data or information
relative to this Amendment Agreement, including, without limitation, listings of
serial numbers or other identification data and confirmations of such
information, as USBPS may time-to-time reasonably request.
(ii) NO AMENDMENTS. Subsequent to the date of this
Amendment Agreement, the Company will not agree or consent to any amendments or
modifications to any agreement between the Company and DVI, GECC or Xxxxx Fargo
Foothill, Inc. ("FOOTHILL") containing terms (including, but not limited to,
increasing interest rates, accelerating the principal amortization or maturity,
new or more stringent defaults, additional collateral, and new remedies
provisions) that would be more onerous to the Company, or adversely impact or
affect GECC with respect to the terms of this Amendment Agreement.
(iii) DISTRIBUTIONS. The Company shall not make any
distribution or declare or pay any dividends (in cash or other property, other
than common stock) on, or purchase, acquire, redeem, or retire any of the
Company's stock, of any class, whether now or hereafter outstanding
(collectively, "DISTRIBUTIONS"); PROVIDED, HOWEVER, that so long as no default
shall have occurred and be continuing immediately prior to or after giving
4
effect to any such payment, (a) the Company may make Distributions to Primedex
Health Systems, Inc., a New York corporation (the "PARENT") (1) in amounts
necessary to pay customary expenses of Parent in the ordinary course of its
business as a public holding company (including salaries and related reasonable
and customary expenses incurred by employees of Parent) in an aggregate amount
not to exceed $750,000 in any fiscal year, (2) in amounts necessary to enable
Parent to pay taxes when due and owing by it in the ordinary course of its
business as a holding company and (3) in amounts necessary to enable Parent to
pay interest on those certain 11.5% Series A Convertible Subordinated Notes due
June 30, 2008, issued by Parent on June 25, 1993, and (b) Parent may make
Distributions in the form of common stock.
(iv) FIXED CHARGE COVERAGE RATIO. Commencing April
30, 2005, the Company shall not permit the Fixed Charge Coverage Ratio, (a) to
be less than 1.0:1 as of the end of each April, July, October and January (each,
a "FISCAL QUARTER") ending prior to January 1, 2007, and (b) to be less than
1.05:1 as of the last day of each Fiscal Quarter ending thereafter. "FIXED
CHARGE COVERAGE RATIO" means for any period, the ratio of (i) EBITDA for such
period MINUS cash capital expenditures made (to the extent not already incurred
in a prior period) or incurred during such period, to (ii) the sum of (a)
interest expense, (b) principal payments required to be paid during such period
in respect of indebtedness, and (c) all federal, state, and local income taxes
accrued, all as determined for the twelve months ending on the determination
date for the Company and its subsidiaries on a consolidated basis without
duplication and in accordance with generally accepted accounting principles
consistently applied. "EBITDA" means, with respect to any fiscal period, the
Company's and its subsidiaries' consolidated net earnings (or loss), minus
extraordinary gains and interest income, plus interest expense, income taxes,
and depreciation and amortization for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(v) LEVERAGE RATIO. The Company shall not permit the
Leverage Ratio, as determined as of the end of each Fiscal Quarter, to be
greater than the amount set forth in the following table for the Fiscal Quarters
ending in the period set forth opposite thereto:
LEVERAGE RATIO Period
-------------- ------
4.50:1.0 04/30/05 - 10/30/05
4.30:1.0 10/31/05 - 10/30/06
4.00:1.0 10/31/06 - 10/30/07
3.80:1.0 10/31/07 - 10/30/08
"LEVERAGE RATIO" means, at any date of determination, the
ratio of (a) Total Debt at such date to (b) EBITDA for the applicable period
ending on such date. "TOTAL DEBT" means, as of any date of determination,
without duplication, the sum of (a) the outstanding aggregate amount of the
obligations for borrowed money, (b) the outstanding principal amount of capital
leases, (c) the outstanding principal amount of purchase money indebtedness, (d)
the outstanding principal amount of funded debt, and (e) the outstanding
principal amount of all obligations owing to GECC, DVI and USBPS; all as
5
determined for the Company and its subsidiaries on a consolidated basis without
duplication and in accordance with generally accepted accounting principles
consistently applied.
(vi) EBITDA MARGIN. The Company shall not permit the
EBITDA Margin to be less than 25% as of the end of any Fiscal Quarter ending on
or after April 30, 2005. "EBITDA MARGIN" means for any period, the ratio of (a)
EBITDA for such period, to (b) net revenues (excluding the professional service
fee component of radiology services) for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(vii) RECEIVABLE DAYS. The Company shall not permit
the Receivable Days to exceed 65 days as of the end of any Fiscal Quarter ending
on or after April 30, 2005. "RECEIVABLE DAYS" means for any period, a number
equal to (a) 365 divided by (b) the result of (i) net revenues for such period
divided by (ii) net receivables for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(viii) NAME CHANGES, ETC. The Company agrees that it
shall not change its name or jurisdiction of organization without giving 30 days
prior written notice to USBPS.
10. To induce USBPS on behalf of the Trustee to enter this
Agreement, the Guarantor hereby affirms and restates its Guarantee as related to
this Loan and AMENDED AND RESTATED RIDER A.
11. DIS, the Company and the Guarantor each represent and
warrant that each has been represented by an attorney of its choice and is fully
aware of the terms contained in this Agreement and AMENDED AND RESTATED RIDER A
to which it is a party which was voluntarily entered into without coercion or
duress of any kind.
12. DIS represents and warrants to USBPS on behalf of the
Noteholders and Trustee that all necessary actions on the part of DIS to be
taken in connection with the execution, delivery and performance of this
Agreement have been taken; the performance by DIS of this Agreement and the
AMENDED AND RESTATED RIDER A will not violate any of DIS's Articles of
Incorporation, Articles of Formation, Partnership Agreement or other agreement
or law by which DIS is bound.
6
13. Any notice, request, direction, consent, approval, waiver
or other communication required or permitted under this Agreement to be sent
must be in writing and will become effective only upon delivery to USBPS at the
address set forth herein as follows:
U.S. Bank Portfolio Services
0000 Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxx, XX 00000
Attn: Xxxx Xxx, Director of Operations
14. Except as provided herein, and in the AMENDED AND RESTATED
RIDER A, all of the other provisions of the Loan Documents not restated will
remain in effect.
15. This Agreement and the documents referenced herein
constitute the entire and final agreement among the parties with respect to the
subject matter hereof and there are no agreements, understandings, warranties or
representations among the parties with respect to these matters except as set
forth herein.
16. This Agreement will inure to the benefit of and bind the
parties and their respective successors and permitted assigns.
17. Neither this Agreement nor any of the provisions hereof
can be changed, waived, discharged or terminated except by an instrument in
writing signed by the parties against whom such enforcement of the change,
waiver, discharge or termination is sought.
18. This Agreement will be interpreted and construed under the
laws of the Commonwealth of Pennsylvania, regardless of the domicile of any
party and will be considered to have been made, executed and performed in
Pennsylvania.
7
19. THE UNDERSIGNED, AND SUBJECT TO THE PROVISIONS CONTAINED
HEREIN, USBPS FOR ITSELF AND AS AGENT FOR THE TRUSTEE, (A) AGREE TO SUBMIT FOR
THEMSELVES, IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT AND ANY
SCHEDULE OR FOR RECOGNITION AND ENFORCEMENT OF ANY JUDGMENT IN RESPECT HEREOF OR
THEREOF, TO THE EXCLUSIVE JURISDICTION OF THE COURTS OF THE COMONWEALTH OF
PENNSYLVANIA, THE COURTS OF THE UNITED STATES OF AMERICA FOR THE EASTERN
DISTRICT OF PENNSYLVANIA, AND APPELLATE COURTS FROM ANY THEREOF, (B) CONSENT
THAT ANY ACTION OR PROCEEDING SHALL BE BROUGHT IN SUCH COURTS, AND WAIVE ANY
OBJECTION THAT EACH MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH ACTION OR
PROCEEDING IN ANY SUCH COURT, (C) AGREE THAT SERVICE OF PROCESS OF ANY SUCH
ACTION OR PROCEEDING MAY BE EFFECTED BY CERTIFIED MAIL (OR ANY SUBSTANTIALLY
SIMILAR FORM OF MAIL), POSTAGE PREPAID, TO THE APPROPRIATE PARTY AT ITS ADDRESS
AS SET FORTH HEREIN, AND SERVICE MADE SHALL BE DEEMED TO BE COMPLETED UPON THE
EARLIER OF ACTUAL RECEIPT OR FIVE (5) DAYS AFTER THE SAME SHALL HAVE BEEN POSTED
AS AFORESAID, AND (D) AGREE THAT NOTHING HEREIN OR IN ANY EXHIBIT OR SCHEDULE
SHALL AFFECT THE RIGHT TO EFFECT SERVICE OF PROCESS IN ANY OTHER MANNER
PERMITTED BY LAW. USBPS AND THE UNDERSIGNED EACH HEREBY UNCONDITIONALLY WAIVES
ITS RIGHT TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING
OUT OF, DIRECTLY OR INDIRECTLY, THIS AGREEMENT, ANY EXHIBIT AND THE TRANSACTIONS
8
CONTEMPLATED HEREBY AND THEREBY, ANY OF THE RELATED DOCUMENTS, ANY DEALINGS
BETWEEN THE PARTIES HERETO RELATING TO THE SUBJECT MATTER HEREOF OR THEREOF,
AND/OR THE RELATIONSHIP THAT IS BEING ESTABLISHED BETWEEN USBPS AS AGENT FOR THE
TRUSTEE AND THE UNDERSIGNED, PROVIDED USBPS MAY IN ITS DISCRETION ENFORCE THE
TERMS OF THE FORUM SELECTION PROVISIONS IN THE LOANS.
20. DIS, the Company and the Guarantor hereby release USBPS,
the Trustee, and the Noteholders from and against any claim, loss, or damage
arising out of the negotiation execution, and performance of the Loan or related
matters prior to the date hereof.
21. This Agreement may be executed in two or more counterparts
and each counterpart shall be deemed an original.
9
LYON FINANCIAL SERVICES, INC. DBA U.S. BANK
PORTFOLIO SERVICES, AS SUCCESSOR SERVICER
FOR DVI RECEIVABLES XVIII, L.L.C. AND AS
AGENT FOR U.S. BANK, N.A., AS TRUSTEE
By:_________________________________________
DIAGNOSTIC IMAGING SERVICES, INC.
By:_________________________________________
RADNET MANAGEMENT, INC.
By:_________________________________________
ACKNOWLEDGED AND AGREED TO:
Primedex Health Systems, Inc., Guarantor
By:_________________________________________
10
AMENDMENT TO LOAN DOCUMENTS
---------------------------
AGREEMENT made as of June 30, 2004 ("AMENDMENT AGREEMENT" or
"AGREEMENT") by and between LYON FINANCIAL SERVICES, INC. DBA U.S. BANK
PORTFOLIO SERVICES, as Successor Servicer for DVI Receivables XIX, L.L.C. and as
Agent for U.S. Bank, N.A., as Trustee, with offices at 0000 Xxxxxx Xxxxxx, Xxxxx
000, Xxxxxxxx, Xxxxxxxxx 00000 ("USBPS") and Diagnostic Imaging Services, Inc.,
a corporation, with offices at 0000 Xxxxxxx Xxxxxx, Xxxxxxxxx, XX 00000 ("DIS"),
and such other signatories hereto.
WHEREAS, on or about March 20, 2002, DIS executed and
delivered to DVI Financial Services Inc. ("DVI") a Master Loan Agreement
collectively with the Secured Promissory Note Number #3441-003 dated March 20,
2002 (the "LOAN");
WHEREAS, to secure the payment of the Loan and all other
obligations of DIS to DVI (collectively the "OBLIGATIONS"), DIS, pursuant to a
Master Security Agreement dated on or about March 20, 2002 (the "SECURITY
AGREEMENT"), granted DVI a first priority security interest in certain
Collateral described therein;
WHEREAS, to further secure payment of the Note and all other
Obligations of DIS to DVI, DIS delivered to DVI the guarantee (the "GUARANTEE")
of Primedex Health Systems, Inc. (the "GUARANTOR") (the "GUARANTEE" together
with the Loan and ancillary documents are, collectively the "LOAN DOCUMENTS");
WHEREAS, substantially contemporaneously therewith, DVI
contributed all of the Loan Documents to DVI Receivables XIX, L.L.C. ("DVI XIX")
and thereafter pursuant to an Amended and Restated Indenture, DVI XIX granted a
first priority security interest in and pledged all of the Loan Documents in
favor of U.S. Bank, N.A., as Trustee, for the benefit of a noteholder which
purchased asset backed promissory notes issued by DVI XIX (the "Noteholder");
WHEREAS, DVI contributed other Loans with DIS or certain
affiliates of DIS to this and other DVI securitizations (collectively the
"RELATED LOANS");
WHEREAS, DIS is in default under the terms of the Loan;
WHEREAS, DIS has requested USBPS to modify the Loan to reflect
an adjustment in payments;
WHEREAS, DIS and/or certain of its affiliates have agreed to
modify the Related Loans;
WHEREAS, DIS and certain of its affiliates are engaged in
negotiations to restructure or modify certain loan agreements, loans and
promissory notes with each of General Electric Capital Corporation ("GECC") and
DVI (with respect to GECC, the "GECC MODIFICATION", and with respect to DVI, the
"DVI MODIFICATION");
WHEREAS, subject to the following terms and conditions, USBPS
is willing to modify the Loan as hereinafter provided.
NOW, THEREFORE, the parties agree as follows:
1. All of the Whereas clauses are incorporated herein as if
hereinafter set forth at full length.
2. DIS acknowledges that it is duly indebted to the Trustee in
the sum set forth on AMENDED AND RESTATED RIDER A annexed hereto, and has no
defenses, counterclaims or offsets to such indebtedness.
3. USBPS as Agent for the Trustee will modify the Loan to
provide for payments to commence in accordance with the attached revised payment
schedule (the "AMENDED AND RESTATED RIDER A"). DIS may, at any time, prepay all
2
of the then outstanding Obligations subject to an additional prepayment fee of
2% of such Obligations. Partial prepayments of the Obligations shall not be
permitted at any time.
4. This Agreement shall become effective upon the date that
USBPS receives this Agreement duly executed by DIS and the satisfaction of each
of the following conditions:
(a) DIS and/or its affiliates shall have entered into
agreements on similar terms to this Agreement and otherwise in
form and substance satisfactory to USBPS, relating to the
Related Loans (the "Related Loan Modifications");
(b) reimbursement of USBPS's legal fees incurred in
connection with the execution of this Agreement and the
Related Loan Modifications, aggregating $50,000, shall have
been received by USBPS;
(c) DIS and/or its affiliates shall have entered into
the GECC Modification and the DVI Modification.
5. The closing of the restructuring of the DIS Loan is further
subject to delivery to USBPS of all of the following, each in form and substance
satisfactory to USBPS and its counsel:
(a) The executed AMENDED AND RESTATED RIDER A;
(b) An executed copy of this Agreement;
(c) Such other documents, including UCC financing
statements as USBPS reasonably requests.
6. DIS hereby acknowledges and agrees that it has no, and will
not assert any, defenses, counterclaims or offsets to the Loan and AMENDED AND
RESTATED RIDER A and acknowledges and agrees that the Trustee holds a
first-priority security interest in the Collateral.
7. Any default or other breach of any obligation under the
GECC Modification, the DVI Modification, or any of the Related Loan
Modifications shall constitute a default under the Loan as modified by this
Agreement, and USBPS shall have all remedies thereunder.
3
8. DIS hereby releases the Noteholder, USBPS individually and
as agent for the Trustee and the special purpose entities for which the Trustee
holds collateral, from and against any claims, loss or damage of any kind or
nature arising out of the Loan.
9. So long as any of the Obligations remain outstanding,
Radnet Management, Inc. (the "COMPANY") agrees as follows:
(i) FINANCIAL REPORTING. The Company shall furnish
the following documents or information to USBPS:
(A) Within 30 days after the end of each
Fiscal Quarter (as defined below) (i) (or 90 days in respect of the last month
of the fiscal year), the Company's consolidated, consolidating and on a center
by center basis, financial statements, including the most recent annual report,
balance sheet (not on a center by center basis) and income statement, prepared
in accordance with generally accepted accounting principles, which reports, the
Company warrants, shall fully and fairly represent the true financial condition
of the Company and (ii) updated projections for the Company and for each center;
(B) any other financial information normally
provided by the Company to the public; and
(C) Such other financial data or information
relative to this Amendment Agreement, including, without limitation, listings of
serial numbers or other identification data and confirmations of such
information, as USBPS may time-to-time reasonably request.
(ii) NO AMENDMENTS. Subsequent to the date of this
Amendment Agreement, the Company will not agree or consent to any amendments or
modifications to any agreement between the Company and DVI, GECC or Xxxxx Fargo
Foothill, Inc. ("FOOTHILL") containing terms (including, but not limited to,
increasing interest rates, accelerating the principal amortization or maturity,
new or more stringent defaults, additional collateral, and new remedies
provisions) that would be more onerous to the Company, or adversely impact or
affect GECC with respect to the terms of this Amendment Agreement.
(iii) DISTRIBUTIONS. The Company shall not make any
distribution or declare or pay any dividends (in cash or other property, other
than common stock) on, or purchase, acquire, redeem, or retire any of the
Company's stock, of any class, whether now or hereafter outstanding
(collectively, "DISTRIBUTIONS"); PROVIDED, HOWEVER, that so long as no default
shall have occurred and be continuing immediately prior to or after giving
4
effect to any such payment, (a) the Company may make Distributions to Primedex
Health Systems, Inc., a New York corporation (the "PARENT") (1) in amounts
necessary to pay customary expenses of Parent in the ordinary course of its
business as a public holding company (including salaries and related reasonable
and customary expenses incurred by employees of Parent) in an aggregate amount
not to exceed $750,000 in any fiscal year, (2) in amounts necessary to enable
Parent to pay taxes when due and owing by it in the ordinary course of its
business as a holding company and (3) in amounts necessary to enable Parent to
pay interest on those certain 11.5% Series A Convertible Subordinated Notes due
June 30, 2008, issued by Parent on June 25, 1993, and (b) Parent may make
Distributions in the form of common stock.
(iv) FIXED CHARGE COVERAGE RATIO. Commencing April
30, 2005, the Company shall not permit the Fixed Charge Coverage Ratio, (a) to
be less than 1.0:1 as of the end of each April, July, October and January (each,
a "FISCAL QUARTER") ending prior to January 1, 2007, and (b) to be less than
1.05:1 as of the last day of each Fiscal Quarter ending thereafter. "FIXED
CHARGE COVERAGE RATIO" means for any period, the ratio of (i) EBITDA for such
period MINUS cash capital expenditures made (to the extent not already incurred
in a prior period) or incurred during such period, to (ii) the sum of (a)
interest expense, (b) principal payments required to be paid during such period
in respect of indebtedness, and (c) all federal, state, and local income taxes
accrued, all as determined for the twelve months ending on the determination
date for the Company and its subsidiaries on a consolidated basis without
duplication and in accordance with generally accepted accounting principles
consistently applied. "EBITDA" means, with respect to any fiscal period, the
Company's and its subsidiaries' consolidated net earnings (or loss), minus
extraordinary gains and interest income, plus interest expense, income taxes,
and depreciation and amortization for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(v) LEVERAGE RATIO. The Company shall not permit the
Leverage Ratio, as determined as of the end of each Fiscal Quarter, to be
greater than the amount set forth in the following table for the Fiscal Quarters
ending in the period set forth opposite thereto:
LEVERAGE RATIO Period
-------------- ------
4.50:1.0 04/30/05 - 10/30/05
4.30:1.0 10/31/05 - 10/30/06
4.00:1.0 10/31/06 - 10/30/07
3.80:1.0 10/31/07 - 10/30/08
"LEVERAGE RATIO" means, at any date of determination, the
ratio of (a) Total Debt at such date to (b) EBITDA for the applicable period
ending on such date. "TOTAL DEBT" means, as of any date of determination,
without duplication, the sum of (a) the outstanding aggregate amount of the
obligations for borrowed money, (b) the outstanding principal amount of capital
leases, (c) the outstanding principal amount of purchase money indebtedness, (d)
5
the outstanding principal amount of funded debt, and (e) the outstanding
principal amount of all obligations owing to GECC, DVI and USBPS; all as
determined for the Company and its subsidiaries on a consolidated basis without
duplication and in accordance with generally accepted accounting principles
consistently applied.
(vi) EBITDA MARGIN. The Company shall not permit the
EBITDA Margin to be less than 25% as of the end of any Fiscal Quarter ending on
or after April 30, 2005. "EBITDA MARGIN" means for any period, the ratio of (a)
EBITDA for such period, to (b) net revenues (excluding the professional service
fee component of radiology services) for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(vii) RECEIVABLE DAYS. The Company shall not permit
the Receivable Days to exceed 65 days as of the end of any Fiscal Quarter ending
on or after April 30, 2005. "RECEIVABLE DAYS" means for any period, a number
equal to (a) 365 divided by (b) the result of (i) net revenues for such period
divided by (ii) net receivables for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied. (viii) NAME
CHANGES, ETC. The Company agrees that it shall not change its name or
jurisdiction of organization without giving 30 days prior written notice to
USBPS.
10. To induce USBPS on behalf of the Trustee to enter this
Agreement, the Guarantor hereby affirms and restates its Guarantee as related to
this Loan and AMENDED AND RESTATED RIDER A.
11. DIS, the Company and the Guarantor each represent and
warrant that each has been represented by an attorney of its choice and is fully
aware of the terms contained in this Agreement and AMENDED AND RESTATED RIDER A
to which it is a party which was voluntarily entered into without coercion or
duress of any kind.
12. DIS represents and warrants to USBPS on behalf of the
Noteholders and Trustee that all necessary actions on the part of DIS to be
taken in connection with the execution, delivery and performance of this
Agreement have been taken; the performance by DIS of this Agreement and the
AMENDED AND RESTATED RIDER A will not violate any of DIS's Articles of
Incorporation, Articles of Formation, Partnership Agreement or other agreement
or law by which DIS is bound.
6
13. Any notice, request, direction, consent, approval, waiver
or other communication required or permitted under this Agreement to be sent
must be in writing and will become effective only upon delivery to USBPS at the
address set forth herein as follows:
U.S. Bank Portfolio Services
0000 Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxx, XX 00000
Attn: Xxxx Xxx, Director of Operations
14. Except as provided herein, and in the AMENDED AND RESTATED
RIDER A, all of the other provisions of the Loan Documents not restated will
remain in effect.
15. This Agreement and the documents referenced herein
constitute the entire and final agreement among the parties with respect to the
subject matter hereof and there are no agreements, understandings, warranties or
representations among the parties with respect to these matters except as set
forth herein.
16. This Agreement will inure to the benefit of and bind the
parties and their respective successors and permitted assigns.
17. Neither this Agreement nor any of the provisions hereof
can be changed, waived, discharged or terminated except by an instrument in
writing signed by the parties against whom such enforcement of the change,
waiver, discharge or termination is sought.
18. This Agreement will be interpreted and construed under the
laws of the Commonwealth of Pennsylvania, regardless of the domicile of any
party and will be considered to have been made, executed and performed in
Pennsylvania.
7
19. THE UNDERSIGNED, AND SUBJECT TO THE PROVISIONS CONTAINED
HEREIN, USBPS FOR ITSELF AND AS AGENT FOR THE TRUSTEE, (A) AGREE TO SUBMIT FOR
THEMSELVES, IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT AND ANY
SCHEDULE OR FOR RECOGNITION AND ENFORCEMENT OF ANY JUDGMENT IN RESPECT HEREOF OR
THEREOF, TO THE EXCLUSIVE JURISDICTION OF THE COURTS OF THE COMONWEALTH OF
PENNSYLVANIA, THE COURTS OF THE UNITED STATES OF AMERICA FOR THE EASTERN
DISTRICT OF PENNSYLVANIA, AND APPELLATE COURTS FROM ANY THEREOF, (B) CONSENT
THAT ANY ACTION OR PROCEEDING SHALL BE BROUGHT IN SUCH COURTS, AND WAIVE ANY
OBJECTION THAT EACH MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH ACTION OR
PROCEEDING IN ANY SUCH COURT, (C) AGREE THAT SERVICE OF PROCESS OF ANY SUCH
ACTION OR PROCEEDING MAY BE EFFECTED BY CERTIFIED MAIL (OR ANY SUBSTANTIALLY
SIMILAR FORM OF MAIL), POSTAGE PREPAID, TO THE APPROPRIATE PARTY AT ITS ADDRESS
AS SET FORTH HEREIN, AND SERVICE MADE SHALL BE DEEMED TO BE COMPLETED UPON THE
EARLIER OF ACTUAL RECEIPT OR FIVE (5) DAYS AFTER THE SAME SHALL HAVE BEEN POSTED
AS AFORESAID, AND (D) AGREE THAT NOTHING HEREIN OR IN ANY EXHIBIT OR SCHEDULE
SHALL AFFECT THE RIGHT TO EFFECT SERVICE OF PROCESS IN ANY OTHER MANNER
PERMITTED BY LAW. USBPS AND THE UNDERSIGNED EACH HEREBY UNCONDITIONALLY WAIVES
ITS RIGHT TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING
OUT OF, DIRECTLY OR INDIRECTLY, THIS AGREEMENT, ANY EXHIBIT AND THE TRANSACTIONS
8
CONTEMPLATED HEREBY AND THEREBY, ANY OF THE RELATED DOCUMENTS, ANY DEALINGS
BETWEEN THE PARTIES HERETO RELATING TO THE SUBJECT MATTER HEREOF OR THEREOF,
AND/OR THE RELATIONSHIP THAT IS BEING ESTABLISHED BETWEEN USBPS AS AGENT FOR THE
TRUSTEE AND THE UNDERSIGNED, PROVIDED USBPS MAY IN ITS DISCRETION ENFORCE THE
TERMS OF THE FORUM SELECTION PROVISIONS IN THE LOANS.
20. DIS, the Company and the Guarantor hereby release USBPS,
the Trustee, and the Noteholders from and against any claim, loss, or damage
arising out of the negotiation execution, and performance of the Loan or related
matters prior to the date hereof.
21. This Agreement may be executed in two or more counterparts
and each counterpart shall be deemed an original.
9
LYON FINANCIAL SERVICES, INC. DBA U.S. BANK
PORTFOLIO SERVICES, AS SUCCESSOR SERVICER
FOR DVI RECEIVABLES XIX, L.L.C. AND AS AGENT
FOR U.S. BANK, N.A., AS TRUSTEE
By:_________________________________________
DIAGNOSTIC IMAGING SERVICES, INC.
By:_________________________________________
RADNET MANAGEMENT, INC.
By:_________________________________________
ACKNOWLEDGED AND AGREED TO:
Primedex Health Systems, Inc., Guarantor
By:_________________________________________
10
AMENDMENT TO LOAN DOCUMENTS
---------------------------
AGREEMENT made as of June 30, 2004 ("AMENDMENT AGREEMENT" or
"AGREEMENT") by and between LYON FINANCIAL SERVICES, INC. DBA U.S. BANK
PORTFOLIO SERVICES, as Successor Servicer for DVI Receivables XVII, L.L.C. and
as Agent for U.S. Bank, N.A., as Trustee, with offices at 0000 Xxxxxx Xxxxxx,
Xxxxx 000, Xxxxxxxx, Xxxxxxxxx 00000 ("USBPS") and Diagnostic Imaging Services,
Inc., a corporation, with offices at 0000 X. Xxx Xxxxx Xxxx Xxx 000, Xxxxxxxxx,
XX 00000 ("DIS"), and such other signatories hereto.
WHEREAS, on or about March 20, 2002, DIS executed and
delivered to DVI Financial Services Inc. ("DVI") a Master Loan Agreement
collectively with the Secured Promissory Note Number #3441-001 dated March 20,
2002 (the "LOAN");
WHEREAS, to secure the payment of the Loan and all other
obligations of DIS to DVI (collectively the "OBLIGATIONS"), DIS, pursuant to a
Master Security Agreement dated on or about March 20, 2002 (the "SECURITY
AGREEMENT"), granted DVI a first priority security interest in certain
Collateral described therein;
WHEREAS, to further secure payment of the Note and all other
Obligations of DIS to DVI, DIS delivered to DVI the guarantee (the "GUARANTEE")
of Primedex Health Systems, Inc. (the "GUARANTOR") (the "GUARANTEE" together
with the Loan and ancillary documents are, collectively the "LOAN DOCUMENTS");
WHEREAS, substantially contemporaneously therewith, DVI
contributed all of the Loan Documents to DVI Receivables XVII, L.L.C. ("DVI
XVII") and thereafter pursuant to an Amended and Restated Indenture, DVI XVII
granted a first priority security interest in and pledged all of the Loan
Documents in favor of U.S. Bank, N.A., as Trustee, for the benefit of a
noteholder which purchased asset backed promissory notes issued by DVI XVII (the
"Noteholder");
WHEREAS, DVI contributed other Loans with DIS or certain
affiliates of DIS to this and other DVI securitizations (collectively the
"RELATED LOANS");
WHEREAS, DIS is in default under the terms of the Loan;
WHEREAS, DIS has requested USBPS to modify the Loan to reflect
an adjustment in payments;
WHEREAS, DIS and/or certain of its affiliates have agreed to
modify the Related Loans;
WHEREAS, DIS and certain of its affiliates are engaged in
negotiations to restructure or modify certain loan agreements, loans and
promissory notes with each of General Electric Capital Corporation ("GECC") and
DVI (with respect to GECC, the "GECC MODIFICATION", and with respect to DVI, the
"DVI MODIFICATION");
WHEREAS, subject to the following terms and conditions, USBPS
is willing to modify the Loan as hereinafter provided.
NOW, THEREFORE, the parties agree as follows:
1. All of the Whereas clauses are incorporated herein as if
hereinafter set forth at full length.
2. DIS acknowledges that it is duly indebted to the Trustee in
the sum set forth on AMENDED AND RESTATED RIDER A annexed hereto, and has no
defenses, counterclaims or offsets to such indebtedness.
3. USBPS as Agent for the Trustee will modify the Loan to
provide for payments to commence in accordance with the attached revised payment
schedule (the "AMENDED AND RESTATED RIDER A"). DIS may, at any time, prepay all
2
of the then outstanding Obligations subject to an additional prepayment fee of
2% of such Obligations. Partial prepayments of the Obligations shall not be
permitted at any time.
4. This Agreement shall become effective upon the date that
USBPS receives this Agreement duly executed by DIS and the satisfaction of each
of the following conditions:
(a) DIS and/or its affiliates shall have entered into
agreements on similar terms to this Agreement and otherwise in
form and substance satisfactory to USBPS, relating to the
Related Loans (the "Related Loan Modifications");
(b) reimbursement of USBPS's legal fees incurred in
connection with the execution of this Agreement and the
Related Loan Modifications, aggregating $50,000, shall have
been received by USBPS;
(c) DIS and/or its affiliates shall have entered into
the GECC Modification and the DVI Modification.
5. The closing of the restructuring of the DIS Loan is further
subject to delivery to USBPS of all of the following, each in form and substance
satisfactory to USBPS and its counsel:
(a) The executed AMENDED AND RESTATED RIDER A;
(b) An executed copy of this Agreement;
(c) Such other documents, including UCC financing
statements as USBPS reasonably requests.
6. DIS hereby acknowledges and agrees that it has no, and will
not assert any, defenses, counterclaims or offsets to the Loan and AMENDED AND
RESTATED RIDER A and acknowledges and agrees that the Trustee holds a
first-priority security interest in the Collateral.
7. Any default or other breach of any obligation under the
GECC Modification, the DVI Modification, or any of the Related Loan
Modifications shall constitute a default under the Loan as modified by this
Agreement, and USBPS shall have all remedies thereunder.
3
8. DIS hereby releases the Noteholder, USBPS individually and
as agent for the Trustee and the special purpose entities for which the Trustee
holds collateral, from and against any claims, loss or damage of any kind or
nature arising out of the Loan.
9. So long as any of the Obligations remain outstanding,
Radnet Management, Inc. (the "COMPANY") agrees as follows:
(i) FINANCIAL REPORTING. The Company shall furnish
the following documents or information to USBPS:
(A) Within 30 days after the end of each
Fiscal Quarter (as defined below) (i) (or 90 days in respect of the last month
of the fiscal year), the Company's consolidated, consolidating and on a center
by center basis, financial statements, including the most recent annual report,
balance sheet (not on a center by center basis) and income statement, prepared
in accordance with generally accepted accounting principles, which reports, the
Company warrants, shall fully and fairly represent the true financial condition
of the Company and (ii) updated projections for the Company and for each center;
(B) any other financial information normally
provided by the Company to the public; and
(C) Such other financial data or information
relative to this Amendment Agreement, including, without limitation, listings of
serial numbers or other identification data and confirmations of such
information, as USBPS may time-to-time reasonably request.
(ii) NO AMENDMENTS. Subsequent to the date of this
Amendment Agreement, the Company will not agree or consent to any amendments or
modifications to any agreement between the Company and DVI, GECC or Xxxxx Fargo
Foothill, Inc. ("FOOTHILL") containing terms (including, but not limited to,
increasing interest rates, accelerating the principal amortization or maturity,
new or more stringent defaults, additional collateral, and new remedies
provisions) that would be more onerous to the Company, or adversely impact or
affect GECC with respect to the terms of this Amendment Agreement.
(iii) DISTRIBUTIONS. The Company shall not make any
distribution or declare or pay any dividends (in cash or other property, other
than common stock) on, or purchase, acquire, redeem, or retire any of the
Company's stock, of any class, whether now or hereafter outstanding
(collectively, "DISTRIBUTIONS"); PROVIDED, HOWEVER, that so long as no default
shall have occurred and be continuing immediately prior to or after giving
effect to any such payment, (a) the Company may make Distributions to Primedex
4
Health Systems, Inc., a New York corporation (the "PARENT") (1) in amounts
necessary to pay customary expenses of Parent in the ordinary course of its
business as a public holding company (including salaries and related reasonable
and customary expenses incurred by employees of Parent) in an aggregate amount
not to exceed $750,000 in any fiscal year, (2) in amounts necessary to enable
Parent to pay taxes when due and owing by it in the ordinary course of its
business as a holding company and (3) in amounts necessary to enable Parent to
pay interest on those certain 11.5% Series A Convertible Subordinated Notes due
June 30, 2008, issued by Parent on June 25, 1993, and (b) Parent may make
Distributions in the form of common stock.
(iv) FIXED CHARGE COVERAGE RATIO. Commencing April
30, 2005, the Company shall not permit the Fixed Charge Coverage Ratio, (a) to
be less than 1.0:1 as of the end of each April, July, October and January (each,
a "FISCAL QUARTER") ending prior to January 1, 2007, and (b) to be less than
1.05:1 as of the last day of each Fiscal Quarter ending thereafter. "FIXED
CHARGE COVERAGE RATIO" means for any period, the ratio of (i) EBITDA for such
period MINUS cash capital expenditures made (to the extent not already incurred
in a prior period) or incurred during such period, to (ii) the sum of (a)
interest expense, (b) principal payments required to be paid during such period
in respect of indebtedness, and (c) all federal, state, and local income taxes
accrued, all as determined for the twelve months ending on the determination
date for the Company and its subsidiaries on a consolidated basis without
duplication and in accordance with generally accepted accounting principles
consistently applied. "EBITDA" means, with respect to any fiscal period, the
Company's and its subsidiaries' consolidated net earnings (or loss), minus
extraordinary gains and interest income, plus interest expense, income taxes,
and depreciation and amortization for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(v) LEVERAGE RATIO. The Company shall not permit the
Leverage Ratio, as determined as of the end of each Fiscal Quarter, to be
greater than the amount set forth in the following table for the Fiscal Quarters
ending in the period set forth opposite thereto:
LEVERAGE RATIO Period
-------------- ------
4.50:1.0 04/30/05 - 10/30/05
4.30:1.0 10/31/05 - 10/30/06
4.00:1.0 10/31/06 - 10/30/07
3.80:1.0 10/31/07 - 10/30/08
"LEVERAGE RATIO" means, at any date of determination, the
ratio of (a) Total Debt at such date to (b) EBITDA for the applicable period
ending on such date. "TOTAL DEBT" means, as of any date of determination,
without duplication, the sum of (a) the outstanding aggregate amount of the
obligations for borrowed money, (b) the outstanding principal amount of capital
leases, (c) the outstanding principal amount of purchase money indebtedness, (d)
the outstanding principal amount of funded debt, and (e) the outstanding
5
principal amount of all obligations owing to GECC, DVI and USBPS; all as
determined for the Company and its subsidiaries on a consolidated basis without
duplication and in accordance with generally accepted accounting principles
consistently applied.
(vi) EBITDA MARGIN. The Company shall not permit the
EBITDA Margin to be less than 25% as of the end of any Fiscal Quarter ending on
or after April 30, 2005. "EBITDA MARGIN" means for any period, the ratio of (a)
EBITDA for such period, to (b) net revenues (excluding the professional service
fee component of radiology services) for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(vii) RECEIVABLE DAYS. The Company shall not permit
the Receivable Days to exceed 65 days as of the end of any Fiscal Quarter ending
on or after April 30, 2005. "RECEIVABLE DAYS" means for any period, a number
equal to (a) 365 divided by (b) the result of (i) net revenues for such period
divided by (ii) net receivables for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(viii) NAME CHANGES, ETC. The Company agrees that it
shall not change its name or jurisdiction of organization without giving 30 days
prior written notice to USBPS.
10. To induce USBPS on behalf of the Trustee to enter this
Agreement, the Guarantor hereby affirms and restates its Guarantee as related to
this Loan and AMENDED AND RESTATED RIDER A.
11. DIS, the Company and the Guarantor each represent and
warrant that each has been represented by an attorney of its choice and is fully
aware of the terms contained in this Agreement and AMENDED AND RESTATED RIDER A
to which it is a party which was voluntarily entered into without coercion or
duress of any kind.
12. DIS represents and warrants to USBPS on behalf of the
Noteholders and Trustee that all necessary actions on the part of DIS to be
taken in connection with the execution, delivery and performance of this
Agreement have been taken; the performance by DIS of this Agreement and the
AMENDED AND RESTATED RIDER A will not violate any of DIS's Articles of
Incorporation, Articles of Formation, Partnership Agreement or other agreement
or law by which DIS is bound.
6
13. Any notice, request, direction, consent, approval, waiver
or other communication required or permitted under this Agreement to be sent
must be in writing and will become effective only upon delivery to USBPS at the
address set forth herein as follows:
U.S. Bank Portfolio Services
0000 Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxx, XX 00000
Attn: Xxxx Xxx, Director of Operations
14. Except as provided herein, and in the AMENDED AND RESTATED
RIDER A, all of the other provisions of the Loan Documents not restated will
remain in effect.
15. This Agreement and the documents referenced herein
constitute the entire and final agreement among the parties with respect to the
subject matter hereof and there are no agreements, understandings, warranties or
representations among the parties with respect to these matters except as set
forth herein.
16. This Agreement will inure to the benefit of and bind the
parties and their respective successors and permitted assigns.
17. Neither this Agreement nor any of the provisions hereof
can be changed, waived, discharged or terminated except by an instrument in
writing signed by the parties against whom such enforcement of the change,
waiver, discharge or termination is sought.
18. This Agreement will be interpreted and construed under the
laws of the Commonwealth of Pennsylvania, regardless of the domicile of any
party and will be considered to have been made, executed and performed in
Pennsylvania.
7
19. THE UNDERSIGNED, AND SUBJECT TO THE PROVISIONS CONTAINED
HEREIN, USBPS FOR ITSELF AND AS AGENT FOR THE TRUSTEE, (A) AGREE TO SUBMIT FOR
THEMSELVES, IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT AND ANY
SCHEDULE OR FOR RECOGNITION AND ENFORCEMENT OF ANY JUDGMENT IN RESPECT HEREOF OR
THEREOF, TO THE EXCLUSIVE JURISDICTION OF THE COURTS OF THE COMONWEALTH OF
PENNSYLVANIA, THE COURTS OF THE UNITED STATES OF AMERICA FOR THE EASTERN
DISTRICT OF PENNSYLVANIA, AND APPELLATE COURTS FROM ANY THEREOF, (B) CONSENT
THAT ANY ACTION OR PROCEEDING SHALL BE BROUGHT IN SUCH COURTS, AND WAIVE ANY
OBJECTION THAT EACH MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH ACTION OR
PROCEEDING IN ANY SUCH COURT, (C) AGREE THAT SERVICE OF PROCESS OF ANY SUCH
ACTION OR PROCEEDING MAY BE EFFECTED BY CERTIFIED MAIL (OR ANY SUBSTANTIALLY
SIMILAR FORM OF MAIL), POSTAGE PREPAID, TO THE APPROPRIATE PARTY AT ITS ADDRESS
AS SET FORTH HEREIN, AND SERVICE MADE SHALL BE DEEMED TO BE COMPLETED UPON THE
EARLIER OF ACTUAL RECEIPT OR FIVE (5) DAYS AFTER THE SAME SHALL HAVE BEEN POSTED
AS AFORESAID, AND (D) AGREE THAT NOTHING HEREIN OR IN ANY EXHIBIT OR SCHEDULE
SHALL AFFECT THE RIGHT TO EFFECT SERVICE OF PROCESS IN ANY OTHER MANNER
PERMITTED BY LAW. USBPS AND THE UNDERSIGNED EACH HEREBY UNCONDITIONALLY WAIVES
ITS RIGHT TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING
OUT OF, DIRECTLY OR INDIRECTLY, THIS AGREEMENT, ANY EXHIBIT AND THE TRANSACTIONS
8
CONTEMPLATED HEREBY AND THEREBY, ANY OF THE RELATED DOCUMENTS, ANY DEALINGS
BETWEEN THE PARTIES HERETO RELATING TO THE SUBJECT MATTER HEREOF OR THEREOF,
AND/OR THE RELATIONSHIP THAT IS BEING ESTABLISHED BETWEEN USBPS AS AGENT FOR THE
TRUSTEE AND THE UNDERSIGNED, PROVIDED USBPS MAY IN ITS DISCRETION ENFORCE THE
TERMS OF THE FORUM SELECTION PROVISIONS IN THE LOANS.
20. DIS, the Company and the Guarantor hereby release USBPS,
the Trustee, and the Noteholders from and against any claim, loss, or damage
arising out of the negotiation execution, and performance of the Loan or related
matters prior to the date hereof.
21. This Agreement may be executed in two or more counterparts
and each counterpart shall be deemed an original.
9
LYON FINANCIAL SERVICES, INC. DBA U.S. BANK
PORTFOLIO SERVICES, AS SUCCESSOR SERVICER
FOR DVI RECEIVABLES XVII, L.L.C. AND AS
AGENT FOR U.S. BANK, N.A., AS TRUSTEE
By:_________________________________________
DIAGNOSTIC IMAGING SERVICES, INC.
By:_________________________________________
RADNET MANAGEMENT, INC.
By:_________________________________________
ACKNOWLEDGED AND AGREED TO:
Primedex Health Systems, Inc., Guarantor
By:_________________________________________
10
AMENDMENT TO LOAN DOCUMENTS
---------------------------
AGREEMENT made as of June 30, 2004 ("AMENDMENT AGREEMENT" or
"AGREEMENT") by and between LYON FINANCIAL SERVICES, INC. DBA U.S. BANK
PORTFOLIO SERVICES, as Servicer for DVI Receivables XV, L.L.C. and as Agent for
U.S. Bank, N.A., as Trustee, with offices at 0000 Xxxxxx Xxxxxx, Xxxxx 000,
Xxxxxxxx, Xxxxxxxxx 00000 ("USBPS") and Radnet Management, Inc., a corporation,
with offices at 0000 Xxxxxx Xxxxxx, Xxx Xxxxxxx, XX 00000 ("RADNET"), and such
other signatories hereto.
WHEREAS, on or about July 11, 2001, Radnet executed and
delivered to DVI Financial Services Inc. ("DVI") a Master Loan Agreement
collectively with the Secured Promissory Note Number #3155-019 dated January 14,
2002 (the "LOAN");
WHEREAS, to secure the payment of the Loan and all other
obligations of Radnet to DVI (collectively the "OBLIGATIONS"), Radnet, pursuant
to a Master Security Agreement dated on or about July 11, 2001 (the "SECURITY
AGREEMENT"), granted DVI a first priority security interest in certain
Collateral described therein;
WHEREAS, to further secure payment of the Note and all other
Obligations of Radnet to DVI, Radnet delivered to DVI the guarantee (the
"GUARANTEE") of Primedex Health Systems, Inc. (the "GUARANTOR") (the "GUARANTEE"
together with the Loan and ancillary documents are, collectively the "LOAN
DOCUMENTS");
WHEREAS, substantially contemporaneously therewith, DVI
contributed all of the Loan Documents to DVI Receivables XV, L.L.C. ("DVI XV")
and thereafter pursuant to an Amended and Restated Indenture, DVI XV granted a
first priority security interest in and pledged all of the Loan Documents in
favor of U.S. Bank, N.A., as Trustee, for the benefit of a noteholder which
purchased asset backed promissory notes issued by DVI XV (the "Noteholder");
WHEREAS, DVI contributed other Loans with Radnet or certain
affiliates of Radnet to this and other DVI securitizations (collectively the
"RELATED LOANS");
WHEREAS, Radnet is in default under the terms of the Loan;
WHEREAS, Radnet has requested USBPS to modify the Loan to
reflect an adjustment in payments;
WHEREAS, Radnet and/or certain of its affiliates have agreed
to modify the Related Loans;
WHEREAS, Radnet and certain of its affiliates are engaged in
negotiations to restructure or modify certain loan agreements, loans and
promissory notes with each of General Electric Capital Corporation ("GECC") and
DVI (with respect to GECC, the "GECC MODIFICATION", and with respect to DVI, the
"DVI MODIFICATION");
WHEREAS, subject to the following terms and conditions, USBPS
is willing to modify the Loan as hereinafter provided.
NOW, THEREFORE, the parties agree as follows:
1. All of the Whereas clauses are incorporated herein as if
hereinafter set forth at full length.
2. Radnet acknowledges that it is duly indebted to the Trustee
in the sum set forth on AMENDED AND RESTATED RIDER A annexed hereto, and has no
defenses, counterclaims or offsets to such indebtedness.
3. USBPS as Agent for the Trustee will modify the Loan to
provide for payments to commence in accordance with the attached revised payment
schedule (the "AMENDED AND RESTATED RIDER A"). Radnet may, at any time, prepay
2
all of the then outstanding Obligations subject to an additional prepayment fee
of 2% of such Obligations. Partial prepayments of the Obligations shall not be
permitted at any time.
4. This Agreement shall become effective upon the date that
USBPS receives this Agreement duly executed by Radnet and the satisfaction of
each of the following conditions:
(a) Radnet and/or its affiliates shall have entered
into agreements on similar terms to this Agreement and
otherwise in form and substance satisfactory to USBPS,
relating to the Related Loans (the "Related Loan
Modifications");
(b) reimbursement of USBPS's legal fees incurred in
connection with the execution of this Agreement and the
Related Loan Modifications, aggregating $50,000, shall have
been received by USBPS;
(c) Radnet and/or its affiliates shall have entered
into the GECC Modification and the DVI Modification.
5. The closing of the restructuring of the Radnet Loan is
further subject to delivery to USBPS of all of the following, each in form and
substance satisfactory to USBPS and its counsel: (a) The executed AMENDED AND
RESTATED RIDER A; (b) An executed copy of this Agreement; (c) Such other
documents, including UCC financing statements as USBPS reasonably requests.
6. Radnet hereby acknowledges and agrees that it has no, and
will not assert any, defenses, counterclaims or offsets to the Loan and AMENDED
AND RESTATED RIDER A and acknowledges and agrees that the Trustee holds a
first-priority security interest in the Collateral.
7. Any default or other breach of any obligation under the
GECC Modification, the DVI Modification, or any of the Related Loan
Modifications shall constitute a default under the Loan as modified by this
Agreement, and USBPS shall have all remedies thereunder.
3
8. Radnet hereby releases the Noteholder, USBPS individually
and as agent for the Trustee and the special purpose entities for which the
Trustee holds collateral, from and against any claims, loss or damage of any
kind or nature arising out of the Loan.
9. So long as any of the Obligations remain outstanding,
Radnet Management, Inc. (the "COMPANY") agrees as follows:
(i) FINANCIAL REPORTING. The Company shall furnish
the following documents or information to USBPS:
(A) Within 30 days after the end of each
Fiscal Quarter (as defined below) (i) (or 90 days in respect of the last month
of the fiscal year), the Company's consolidated, consolidating and on a center
by center basis, financial statements, including the most recent annual report,
balance sheet (not on a center by center basis) and income statement, prepared
in accordance with generally accepted accounting principles, which reports, the
Company warrants, shall fully and fairly represent the true financial condition
of the Company and (ii) updated projections for the Company and for each center;
(B) any other financial information normally
provided by the Company to the public; and
(C) Such other financial data or information
relative to this Amendment Agreement, including, without limitation, listings of
serial numbers or other identification data and confirmations of such
information, as USBPS may time-to-time reasonably request.
(ii) NO AMENDMENTS. Subsequent to the date of this
Amendment Agreement, the Company will not agree or consent to any amendments or
modifications to any agreement between the Company and DVI, GECC or Xxxxx Fargo
Foothill, Inc. ("FOOTHILL") containing terms (including, but not limited to,
increasing interest rates, accelerating the principal amortization or maturity,
new or more stringent defaults, additional collateral, and new remedies
provisions) that would be more onerous to the Company, or adversely impact or
affect GECC with respect to the terms of this Amendment Agreement.
(iii) DISTRIBUTIONS. The Company shall not make any
distribution or declare or pay any dividends (in cash or other property, other
than common stock) on, or purchase, acquire, redeem, or retire any of the
Company's stock, of any class, whether now or hereafter outstanding
(collectively, "DISTRIBUTIONS"); PROVIDED, HOWEVER, that so long as no default
shall have occurred and be continuing immediately prior to or after giving
4
effect to any such payment, (a) the Company may make Distributions to Primedex
Health Systems, Inc., a New York corporation (the "PARENT") (1) in amounts
necessary to pay customary expenses of Parent in the ordinary course of its
business as a public holding company (including salaries and related reasonable
and customary expenses incurred by employees of Parent) in an aggregate amount
not to exceed $750,000 in any fiscal year, (2) in amounts necessary to enable
Parent to pay taxes when due and owing by it in the ordinary course of its
business as a holding company and (3) in amounts necessary to enable Parent to
pay interest on those certain 11.5% Series A Convertible Subordinated Notes due
June 30, 2008, issued by Parent on June 25, 1993, and (b) Parent may make
Distributions in the form of common stock.
(iv) FIXED CHARGE COVERAGE RATIO. Commencing April
30, 2005, the Company shall not permit the Fixed Charge Coverage Ratio, (a) to
be less than 1.0:1 as of the end of each April, July, October and January (each,
a "FISCAL QUARTER") ending prior to January 1, 2007, and (b) to be less than
1.05:1 as of the last day of each Fiscal Quarter ending thereafter. "FIXED
CHARGE COVERAGE RATIO" means for any period, the ratio of (i) EBITDA for such
period MINUS cash capital expenditures made (to the extent not already incurred
in a prior period) or incurred during such period, to (ii) the sum of (a)
interest expense, (b) principal payments required to be paid during such period
in respect of indebtedness, and (c) all federal, state, and local income taxes
accrued, all as determined for the twelve months ending on the determination
date for the Company and its subsidiaries on a consolidated basis without
duplication and in accordance with generally accepted accounting principles
consistently applied. "EBITDA" means, with respect to any fiscal period, the
Company's and its subsidiaries' consolidated net earnings (or loss), minus
extraordinary gains and interest income, plus interest expense, income taxes,
and depreciation and amortization for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(v) LEVERAGE RATIO. The Company shall not permit the
Leverage Ratio, as determined as of the end of each Fiscal Quarter, to be
greater than the amount set forth in the following table for the Fiscal Quarters
ending in the period set forth opposite thereto:
LEVERAGE RATIO Period
-------------- ------
4.50:1.0 04/30/05 - 10/30/05
4.30:1.0 10/31/05 - 10/30/06
4.00:1.0 10/31/06 - 10/30/07
3.80:1.0 10/31/07 - 10/30/08
"LEVERAGE RATIO" means, at any date of determination, the
ratio of (a) Total Debt at such date to (b) EBITDA for the applicable period
ending on such date. "TOTAL DEBT" means, as of any date of determination,
without duplication, the sum of (a) the outstanding aggregate amount of the
obligations for borrowed money, (b) the outstanding principal amount of capital
leases, (c) the outstanding principal amount of purchase money indebtedness, (d)
5
the outstanding principal amount of funded debt, and (e) the outstanding
principal amount of all obligations owing to GECC, DVI and USBPS; all as
determined for the Company and its subsidiaries on a consolidated basis without
duplication and in accordance with generally accepted accounting principles
consistently applied.
(vi) EBITDA MARGIN. The Company shall not permit the
EBITDA Margin to be less than 25% as of the end of any Fiscal Quarter ending on
or after April 30, 2005. "EBITDA MARGIN" means for any period, the ratio of (a)
EBITDA for such period, to (b) net revenues (excluding the professional service
fee component of radiology services) for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(vii) RECEIVABLE DAYS. The Company shall not permit
the Receivable Days to exceed 65 days as of the end of any Fiscal Quarter ending
on or after April 30, 2005. "RECEIVABLE DAYS" means for any period, a number
equal to (a) 365 divided by (b) the result of (i) net revenues for such period
divided by (ii) net receivables for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(viii) NAME CHANGES, ETC. The Company agrees that it
shall not change its name or jurisdiction of organization without giving 30 days
prior written notice to USBPS.
10. To induce USBPS on behalf of the Trustee to enter this
Agreement, the Guarantor hereby affirms and restates its Guarantee as related to
this Loan and AMENDED AND RESTATED RIDER A.
11. Radnet, the Company and the Guarantor each represent and
warrant that each has been represented by an attorney of its choice and is fully
aware of the terms contained in this Agreement and AMENDED AND RESTATED RIDER A
to which it is a party which was voluntarily entered into without coercion or
duress of any kind.
12. Radnet represents and warrants to USBPS on behalf of the
Noteholders and Trustee that all necessary actions on the part of Radnet to be
taken in connection with the execution, delivery and performance of this
Agreement have been taken; the performance by Radnet of this Agreement and the
AMENDED AND RESTATED RIDER A will not violate any of Radnet's Articles of
Incorporation, Articles of Formation, Partnership Agreement or other agreement
or law by which Radnet is bound.
6
13. Any notice, request, direction, consent, approval, waiver
or other communication required or permitted under this Agreement to be sent
must be in writing and will become effective only upon delivery to USBPS at the
address set forth herein as follows:
U.S. Bank Portfolio Services
0000 Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxx, XX 00000
Attn: Xxxx Xxx, Director of Operations
14. Except as provided herein, and in the AMENDED AND RESTATED
RIDER A, all of the other provisions of the Loan Documents not restated will
remain in effect.
15. This Agreement and the documents referenced herein
constitute the entire and final agreement among the parties with respect to the
subject matter hereof and there are no agreements, understandings, warranties or
representations among the parties with respect to these matters except as set
forth herein.
16. This Agreement will inure to the benefit of and bind the
parties and their respective successors and permitted assigns.
17. Neither this Agreement nor any of the provisions hereof
can be changed, waived, discharged or terminated except by an instrument in
writing signed by the parties against whom such enforcement of the change,
waiver, discharge or termination is sought.
18. This Agreement will be interpreted and construed under the
laws of the Commonwealth of Pennsylvania, regardless of the domicile of any
party and will be considered to have been made, executed and performed in
Pennsylvania.
7
19. THE UNDERSIGNED, AND SUBJECT TO THE PROVISIONS CONTAINED
HEREIN, USBPS FOR ITSELF AND AS AGENT FOR THE TRUSTEE, (A) AGREE TO SUBMIT FOR
THEMSELVES, IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT AND ANY
SCHEDULE OR FOR RECOGNITION AND ENFORCEMENT OF ANY JUDGMENT IN RESPECT HEREOF OR
THEREOF, TO THE EXCLUSIVE JURISDICTION OF THE COURTS OF THE COMONWEALTH OF
PENNSYLVANIA, THE COURTS OF THE UNITED STATES OF AMERICA FOR THE EASTERN
DISTRICT OF PENNSYLVANIA, AND APPELLATE COURTS FROM ANY THEREOF, (B) CONSENT
THAT ANY ACTION OR PROCEEDING SHALL BE BROUGHT IN SUCH COURTS, AND WAIVE ANY
OBJECTION THAT EACH MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH ACTION OR
PROCEEDING IN ANY SUCH COURT, (C) AGREE THAT SERVICE OF PROCESS OF ANY SUCH
ACTION OR PROCEEDING MAY BE EFFECTED BY CERTIFIED MAIL (OR ANY SUBSTANTIALLY
SIMILAR FORM OF MAIL), POSTAGE PREPAID, TO THE APPROPRIATE PARTY AT ITS ADDRESS
AS SET FORTH HEREIN, AND SERVICE MADE SHALL BE DEEMED TO BE COMPLETED UPON THE
EARLIER OF ACTUAL RECEIPT OR FIVE (5) DAYS AFTER THE SAME SHALL HAVE BEEN POSTED
AS AFORESAID, AND (D) AGREE THAT NOTHING HEREIN OR IN ANY EXHIBIT OR SCHEDULE
SHALL AFFECT THE RIGHT TO EFFECT SERVICE OF PROCESS IN ANY OTHER MANNER
PERMITTED BY LAW. USBPS AND THE UNDERSIGNED EACH HEREBY UNCONDITIONALLY WAIVES
ITS RIGHT TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING
OUT OF, DIRECTLY OR INDIRECTLY, THIS AGREEMENT, ANY EXHIBIT AND THE TRANSACTIONS
8
CONTEMPLATED HEREBY AND THEREBY, ANY OF THE RELATED DOCUMENTS, ANY DEALINGS
BETWEEN THE PARTIES HERETO RELATING TO THE SUBJECT MATTER HEREOF OR THEREOF,
AND/OR THE RELATIONSHIP THAT IS BEING ESTABLISHED BETWEEN USBPS AS AGENT FOR THE
TRUSTEE AND THE UNDERSIGNED, PROVIDED USBPS MAY IN ITS DISCRETION ENFORCE THE
TERMS OF THE FORUM SELECTION PROVISIONS IN THE LOANS.
20. Radnet, the Company and the Guarantor hereby release
USBPS, the Trustee, and the Noteholders from and against any claim, loss, or
damage arising out of the negotiation execution, and performance of the Loan or
related matters prior to the date hereof.
21. This Agreement may be executed in two or more counterparts
and each counterpart shall be deemed an original.
9
LYON FINANCIAL SERVICES, INC. DBA U.S. BANK
PORTFOLIO SERVICES, AS SERVICER FOR DVI
RECEIVABLES XV, L.L.C. AND AS AGENT FOR U.S.
BANK, N.A., AS TRUSTEE
By:_________________________________________
RADNET MANAGEMENT, INC.
By:_________________________________________
ACKNOWLEDGED AND AGREED TO:
Primedex Health Systems, Inc., Guarantor
By:_________________________________________
10
AMENDMENT TO LOAN DOCUMENTS
---------------------------
AGREEMENT made as of June 30, 2004 ("AMENDMENT AGREEMENT" or
"AGREEMENT") by and between LYON FINANCIAL SERVICES, INC. DBA U.S. BANK
PORTFOLIO SERVICES, as Servicer for DVI Receivables XV, L.L.C. and as Agent for
U.S. Bank, N.A., as Trustee, with offices at 0000 Xxxxxx Xxxxxx, Xxxxx 000,
Xxxxxxxx, Xxxxxxxxx 00000 ("USBPS") and Radnet Management, Inc., a corporation,
with offices at 0000 Xxxxxx Xxxxxx, Xxx Xxxxxxx, XX 00000 ("RADNET"), and such
other signatories hereto.
WHEREAS, on or about July 11, 2001, Radnet executed and
delivered to DVI Financial Services Inc. ("DVI") a Master Loan Agreement
collectively with the Secured Promissory Note Number #3155-018 dated December
17, 2001 (the "LOAN");
WHEREAS, to secure the payment of the Loan and all other
obligations of Radnet to DVI (collectively the "OBLIGATIONS"), Radnet, pursuant
to a Master Security Agreement dated on or about July 11, 2001 (the "SECURITY
AGREEMENT"), granted DVI a first priority security interest in certain
Collateral described therein;
WHEREAS, to further secure payment of the Note and all other
Obligations of Radnet to DVI, Radnet delivered to DVI the guarantee (the
"GUARANTEE") of Primedex Health Systems, Inc. (the "GUARANTOR") (the "GUARANTEE"
together with the Loan and ancillary documents are, collectively the "LOAN
DOCUMENTS");
WHEREAS, substantially contemporaneously therewith, DVI
contributed all of the Loan Documents to DVI Receivables XV, L.L.C. ("DVI XV")
and thereafter pursuant to an Amended and Restated Indenture, DVI XV granted a
first priority security interest in and pledged all of the Loan Documents in
favor of U.S. Bank, N.A., as Trustee, for the benefit of a noteholder which
purchased asset backed promissory notes issued by DVI XV (the "Noteholder");
WHEREAS, DVI contributed other Loans with Radnet or certain
affiliates of Radnet to this and other DVI securitizations (collectively the
"RELATED LOANS");
WHEREAS, Radnet is in default under the terms of the Loan;
WHEREAS, Radnet has requested USBPS to modify the Loan to
reflect an adjustment in payments;
WHEREAS, Radnet and/or certain of its affiliates have agreed
to modify the Related Loans;
WHEREAS, Radnet and certain of its affiliates are engaged in
negotiations to restructure or modify certain loan agreements, loans and
promissory notes with each of General Electric Capital Corporation ("GECC") and
DVI (with respect to GECC, the "GECC MODIFICATION", and with respect to DVI, the
"DVI MODIFICATION");
WHEREAS, subject to the following terms and conditions, USBPS
is willing to modify the Loan as hereinafter provided.
NOW, THEREFORE, the parties agree as follows:
1. All of the Whereas clauses are incorporated herein as if
hereinafter set forth at full length.
2. Radnet acknowledges that it is duly indebted to the Trustee
in the sum set forth on AMENDED AND RESTATED RIDER A annexed hereto, and has no
defenses, counterclaims or offsets to such indebtedness.
3. USBPS as Agent for the Trustee will modify the Loan to
provide for payments to commence in accordance with the attached revised payment
schedule (the "AMENDED AND RESTATED RIDER A"). Radnet may, at any time, prepay
2
all of the then outstanding Obligations subject to an additional prepayment fee
of 2% of such Obligations. Partial prepayments of the Obligations shall not be
permitted at any time.
4. This Agreement shall become effective upon the date that
USBPS receives this Agreement duly executed by Radnet and the
satisfaction of each of the following conditions:
(a) Radnet and/or its affiliates shall have entered
into agreements on similar terms to this Agreement and
otherwise in form and substance satisfactory to USBPS,
relating to the Related Loans (the "Related Loan
Modifications");
(b) reimbursement of USBPS's legal fees incurred in
connection with the execution of this Agreement and the
Related Loan Modifications, aggregating $50,000, shall have
been received by USBPS;
(c) Radnet and/or its affiliates shall have entered
into the GECC Modification and the DVI Modification.
5. The closing of the restructuring of the Radnet Loan is
further subject to delivery to USBPS of all of the following, each in form and
substance satisfactory to USBPS and its counsel:
(a) The executed AMENDED AND RESTATED RIDER A;
(b) An executed copy of this Agreement;
(c) Such other documents, including UCC financing
statements as USBPS reasonably requests.
6. Radnet hereby acknowledges and agrees that it has no, and
will not assert any, defenses, counterclaims or offsets to the Loan and AMENDED
AND RESTATED RIDER A and acknowledges and agrees that the Trustee holds a
first-priority security interest in the Collateral.
7. Any default or other breach of any obligation under the
GECC Modification, the DVI Modification, or any of the Related Loan
Modifications shall constitute a default under the Loan as modified by this
Agreement, and USBPS shall have all remedies thereunder.
3
8. Radnet hereby releases the Noteholder, USBPS individually
and as agent for the Trustee and the special purpose entities for which the
Trustee holds collateral, from and against any claims, loss or damage of any
kind or nature arising out of the Loan.
9. So long as any of the Obligations remain outstanding,
Radnet Management, Inc. (the "COMPANY") agrees as follows:
(i) FINANCIAL REPORTING. The Company shall furnish
the following documents or information to USBPS:
(A) Within 30 days after the end of each
Fiscal Quarter (as defined below) (i) (or 90 days in respect of the last month
of the fiscal year), the Company's consolidated, consolidating and on a center
by center basis, financial statements, including the most recent annual report,
balance sheet (not on a center by center basis) and income statement, prepared
in accordance with generally accepted accounting principles, which reports, the
Company warrants, shall fully and fairly represent the true financial condition
of the Company and (ii) updated projections for the Company and for each center;
(B) any other financial information normally
provided by the Company to the public; and
(C) Such other financial data or information
relative to this Amendment Agreement, including, without limitation, listings of
serial numbers or other identification data and confirmations of such
information, as USBPS may time-to-time reasonably request.
(ii) NO AMENDMENTS. Subsequent to the date of this
Amendment Agreement, the Company will not agree or consent to any amendments or
modifications to any agreement between the Company and DVI, GECC or Xxxxx Fargo
Foothill, Inc. ("FOOTHILL") containing terms (including, but not limited to,
increasing interest rates, accelerating the principal amortization or maturity,
new or more stringent defaults, additional collateral, and new remedies
provisions) that would be more onerous to the Company, or adversely impact or
affect GECC with respect to the terms of this Amendment Agreement.
(iii) DISTRIBUTIONS. The Company shall not make any
distribution or declare or pay any dividends (in cash or other property, other
than common stock) on, or purchase, acquire, redeem, or retire any of the
Company's stock, of any class, whether now or hereafter outstanding
(collectively, "DISTRIBUTIONS"); PROVIDED, HOWEVER, that so long as no default
shall have occurred and be continuing immediately prior to or after giving
4
effect to any such payment, (a) the Company may make Distributions to Primedex
Health Systems, Inc., a New York corporation (the "PARENT") (1) in amounts
necessary to pay customary expenses of Parent in the ordinary course of its
business as a public holding company (including salaries and related reasonable
and customary expenses incurred by employees of Parent) in an aggregate amount
not to exceed $750,000 in any fiscal year, (2) in amounts necessary to enable
Parent to pay taxes when due and owing by it in the ordinary course of its
business as a holding company and (3) in amounts necessary to enable Parent to
pay interest on those certain 11.5% Series A Convertible Subordinated Notes due
June 30, 2008, issued by Parent on June 25, 1993, and (b) Parent may make
Distributions in the form of common stock.
(iv) FIXED CHARGE COVERAGE RATIO. Commencing April
30, 2005, the Company shall not permit the Fixed Charge Coverage Ratio, (a) to
be less than 1.0:1 as of the end of each April, July, October and January (each,
a "FISCAL QUARTER") ending prior to January 1, 2007, and (b) to be less than
1.05:1 as of the last day of each Fiscal Quarter ending thereafter. "FIXED
CHARGE COVERAGE RATIO" means for any period, the ratio of (i) EBITDA for such
period MINUS cash capital expenditures made (to the extent not already incurred
in a prior period) or incurred during such period, to (ii) the sum of (a)
interest expense, (b) principal payments required to be paid during such period
in respect of indebtedness, and (c) all federal, state, and local income taxes
accrued, all as determined for the twelve months ending on the determination
date for the Company and its subsidiaries on a consolidated basis without
duplication and in accordance with generally accepted accounting principles
consistently applied. "EBITDA" means, with respect to any fiscal period, the
Company's and its subsidiaries' consolidated net earnings (or loss), minus
extraordinary gains and interest income, plus interest expense, income taxes,
and depreciation and amortization for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(v) LEVERAGE RATIO. The Company shall not permit the
Leverage Ratio, as determined as of the end of each Fiscal Quarter, to be
greater than the amount set forth in the following table for the Fiscal Quarters
ending in the period set forth opposite thereto:
LEVERAGE RATIO Period
-------------- ------
4.50:1.0 04/30/05 - 10/30/05
4.30:1.0 10/31/05 - 10/30/06
4.00:1.0 10/31/06 - 10/30/07
3.80:1.0 10/31/07 - 10/30/08
"LEVERAGE RATIO" means, at any date of determination, the
ratio of (a) Total Debt at such date to (b) EBITDA for the applicable period
ending on such date. "TOTAL DEBT" means, as of any date of determination,
without duplication, the sum of (a) the outstanding aggregate amount of the
obligations for borrowed money, (b) the outstanding principal amount of capital
leases, (c) the outstanding principal amount of purchase money indebtedness, (d)
the outstanding principal amount of funded debt, and (e) the outstanding
principal amount of all obligations owing to GECC, DVI and USBPS; all as
5
determined for the Company and its subsidiaries on a consolidated basis without
duplication and in accordance with generally accepted accounting principles
consistently applied.
(vi) EBITDA MARGIN. The Company shall not permit the
EBITDA Margin to be less than 25% as of the end of any Fiscal Quarter ending on
or after April 30, 2005. "EBITDA MARGIN" means for any period, the ratio of (a)
EBITDA for such period, to (b) net revenues (excluding the professional service
fee component of radiology services) for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(vii) RECEIVABLE DAYS. The Company shall not permit
the Receivable Days to exceed 65 days as of the end of any Fiscal Quarter ending
on or after April 30, 2005. "RECEIVABLE DAYS" means for any period, a number
equal to (a) 365 divided by (b) the result of (i) net revenues for such period
divided by (ii) net receivables for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(viii) NAME CHANGES, ETC. The Company agrees that it
shall not change its name or jurisdiction of organization without giving 30 days
prior written notice to USBPS.
10. To induce USBPS on behalf of the Trustee to enter this
Agreement, the Guarantor hereby affirms and restates its Guarantee as related to
this Loan and AMENDED AND RESTATED RIDER A.
11. Radnet, the Company and the Guarantor each represent and
warrant that each has been represented by an attorney of its choice and is fully
aware of the terms contained in this Agreement and AMENDED AND RESTATED RIDER A
to which it is a party which was voluntarily entered into without coercion or
duress of any kind.
12. Radnet represents and warrants to USBPS on behalf of the
Noteholders and Trustee that all necessary actions on the part of Radnet to be
taken in connection with the execution, delivery and performance of this
Agreement have been taken; the performance by Radnet of this Agreement and the
AMENDED AND RESTATED RIDER A will not violate any of Radnet's Articles of
Incorporation, Articles of Formation, Partnership Agreement or other agreement
or law by which Radnet is bound.
6
13. Any notice, request, direction, consent, approval, waiver
or other communication required or permitted under this Agreement to be sent
must be in writing and will become effective only upon delivery to USBPS at the
address set forth herein as follows:
U.S. Bank Portfolio Services
0000 Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxx, XX 00000
Attn: Xxxx Xxx, Director of Operations
14. Except as provided herein, and in the AMENDED AND RESTATED
RIDER A, all of the other provisions of the Loan Documents not restated will
remain in effect.
15. This Agreement and the documents referenced herein
constitute the entire and final agreement among the parties with respect to the
subject matter hereof and there are no agreements, understandings, warranties or
representations among the parties with respect to these matters except as set
forth herein.
16. This Agreement will inure to the benefit of and bind the
parties and their respective successors and permitted assigns.
17. Neither this Agreement nor any of the provisions hereof
can be changed, waived, discharged or terminated except by an instrument in
writing signed by the parties against whom such enforcement of the change,
waiver, discharge or termination is sought.
18. This Agreement will be interpreted and construed under the
laws of the Commonwealth of Pennsylvania, regardless of the domicile of any
party and will be considered to have been made, executed and performed in
Pennsylvania.
7
19. THE UNDERSIGNED, AND SUBJECT TO THE PROVISIONS CONTAINED
HEREIN, USBPS FOR ITSELF AND AS AGENT FOR THE TRUSTEE, (A) AGREE TO SUBMIT FOR
THEMSELVES, IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT AND ANY
SCHEDULE OR FOR RECOGNITION AND ENFORCEMENT OF ANY JUDGMENT IN RESPECT HEREOF OR
THEREOF, TO THE EXCLUSIVE JURISDICTION OF THE COURTS OF THE COMONWEALTH OF
PENNSYLVANIA, THE COURTS OF THE UNITED STATES OF AMERICA FOR THE EASTERN
DISTRICT OF PENNSYLVANIA, AND APPELLATE COURTS FROM ANY THEREOF, (B) CONSENT
THAT ANY ACTION OR PROCEEDING SHALL BE BROUGHT IN SUCH COURTS, AND WAIVE ANY
OBJECTION THAT EACH MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH ACTION OR
PROCEEDING IN ANY SUCH COURT, (C) AGREE THAT SERVICE OF PROCESS OF ANY SUCH
ACTION OR PROCEEDING MAY BE EFFECTED BY CERTIFIED MAIL (OR ANY SUBSTANTIALLY
SIMILAR FORM OF MAIL), POSTAGE PREPAID, TO THE APPROPRIATE PARTY AT ITS ADDRESS
AS SET FORTH HEREIN, AND SERVICE MADE SHALL BE DEEMED TO BE COMPLETED UPON THE
EARLIER OF ACTUAL RECEIPT OR FIVE (5) DAYS AFTER THE SAME SHALL HAVE BEEN POSTED
AS AFORESAID, AND (D) AGREE THAT NOTHING HEREIN OR IN ANY EXHIBIT OR SCHEDULE
SHALL AFFECT THE RIGHT TO EFFECT SERVICE OF PROCESS IN ANY OTHER MANNER
PERMITTED BY LAW. USBPS AND THE UNDERSIGNED EACH HEREBY UNCONDITIONALLY WAIVES
ITS RIGHT TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING
OUT OF, DIRECTLY OR INDIRECTLY, THIS AGREEMENT, ANY EXHIBIT AND THE TRANSACTIONS
8
CONTEMPLATED HEREBY AND THEREBY, ANY OF THE RELATED DOCUMENTS, ANY DEALINGS
BETWEEN THE PARTIES HERETO RELATING TO THE SUBJECT MATTER HEREOF OR THEREOF,
AND/OR THE RELATIONSHIP THAT IS BEING ESTABLISHED BETWEEN USBPS AS AGENT FOR THE
TRUSTEE AND THE UNDERSIGNED, PROVIDED USBPS MAY IN ITS DISCRETION ENFORCE THE
TERMS OF THE FORUM SELECTION PROVISIONS IN THE LOANS.
20. Radnet, the Company and the Guarantor hereby release
USBPS, the Trustee, and the Noteholders from and against any claim, loss, or
damage arising out of the negotiation execution, and performance of the Loan or
related matters prior to the date hereof.
21. This Agreement may be executed in two or more counterparts
and each counterpart shall be deemed an original.
9
LYON FINANCIAL SERVICES, INC. DBA U.S. BANK
PORTFOLIO SERVICES, AS SERVICER FOR DVI
RECEIVABLES XV, L.L.C. AND AS AGENT FOR U.S.
BANK, N.A., AS TRUSTEE
By:_________________________________________
RADNET MANAGEMENT, INC.
By:_________________________________________
ACKNOWLEDGED AND AGREED TO:
Primedex Health Systems, Inc., Guarantor
By:_________________________________________
10
AMENDMENT TO LOAN DOCUMENTS
---------------------------
AGREEMENT made as of June 30, 2004 ("AMENDMENT AGREEMENT" or
"AGREEMENT") by and between LYON FINANCIAL SERVICES, INC. DBA U.S. BANK
PORTFOLIO SERVICES, as Servicer for DVI Receivables XV, L.L.C. and as Agent for
U.S. Bank, N.A., as Trustee, with offices at 0000 Xxxxxx Xxxxxx, Xxxxx 000,
Xxxxxxxx, Xxxxxxxxx 00000 ("USBPS") and Radnet Management, Inc., a corporation,
with offices at 0000 Xxxxxx Xxxxxx, Xxx Xxxxxxx, XX 00000 ("RADNET"), and such
other signatories hereto.
WHEREAS, on or about July 11, 2001, Radnet executed and
delivered to DVI Financial Services Inc. ("DVI") a Master Loan Agreement
collectively with the Secured Promissory Note Number #3155-017 dated December
17, 2001 (the "LOAN");
WHEREAS, to secure the payment of the Loan and all other
obligations of Radnet to DVI (collectively the "OBLIGATIONS"), Radnet, pursuant
to a Master Security Agreement dated on or about July 11, 2001 (the "SECURITY
AGREEMENT"), granted DVI a first priority security interest in certain
Collateral described therein;
WHEREAS, to further secure payment of the Note and all other
Obligations of Radnet to DVI, Radnet delivered to DVI the guarantee (the
"GUARANTEE") of Primedex Health Systems, Inc. (the "GUARANTOR") (the "GUARANTEE"
together with the Loan and ancillary documents are, collectively the "LOAN
DOCUMENTS");
WHEREAS, substantially contemporaneously therewith, DVI
contributed all of the Loan Documents to DVI Receivables XV, L.L.C. ("DVI XV")
and thereafter pursuant to an Amended and Restated Indenture, DVI XV granted a
first priority security interest in and pledged all of the Loan Documents in
favor of U.S. Bank, N.A., as Trustee, for the benefit of a noteholder which
purchased asset backed promissory notes issued by DVI XV (the "Noteholder");
WHEREAS, DVI contributed other Loans with Radnet or certain
affiliates of Radnet to this and other DVI securitizations (collectively the
"RELATED LOANS");
WHEREAS, Radnet is in default under the terms of the Loan;
WHEREAS, Radnet has requested USBPS to modify the Loan to
reflect an adjustment in payments;
WHEREAS, Radnet and/or certain of its affiliates have agreed
to modify the Related Loans;
WHEREAS, Radnet and certain of its affiliates are engaged in
negotiations to restructure or modify certain loan agreements, loans and
promissory notes with each of General Electric Capital Corporation ("GECC") and
DVI (with respect to GECC, the "GECC MODIFICATION", and with respect to DVI, the
"DVI MODIFICATION");
WHEREAS, subject to the following terms and conditions, USBPS
is willing to modify the Loan as hereinafter provided.
NOW, THEREFORE, the parties agree as follows:
1. All of the Whereas clauses are incorporated herein as if
hereinafter set forth at full length.
2. Radnet acknowledges that it is duly indebted to the Trustee
in the sum set forth on AMENDED AND RESTATED RIDER A annexed hereto, and has no
defenses, counterclaims or offsets to such indebtedness.
3. USBPS as Agent for the Trustee will modify the Loan to
provide for payments to commence in accordance with the attached revised payment
schedule (the "AMENDED AND RESTATED RIDER A"). Radnet may, at any time, prepay
2
all of the then outstanding Obligations subject to an additional prepayment fee
of 2% of such Obligations. Partial prepayments of the Obligations shall not be
permitted at any time.
4. This Agreement shall become effective upon the date that
USBPS receives this Agreement duly executed by Radnet and the satisfaction of
each of the following conditions:
(a) Radnet and/or its affiliates shall have entered
into agreements on similar terms to this Agreement and
otherwise in form and substance satisfactory to USBPS,
relating to the Related Loans (the "Related Loan
Modifications");
(b) reimbursement of USBPS's legal fees incurred in
connection with the execution of this Agreement and the
Related Loan Modifications, aggregating $50,000, shall have
been received by USBPS;
(c) Radnet and/or its affiliates shall have entered
into the GECC Modification and the DVI Modification.
5. The closing of the restructuring of the Radnet Loan is
further subject to delivery to USBPS of all of the following, each in form and
substance satisfactory to USBPS and its counsel:
(a) The executed AMENDED AND RESTATED RIDER A;
(b) An executed copy of this Agreement;
(c) Such other documents, including UCC financing
statements as USBPS reasonably requests.
6. Radnet hereby acknowledges and agrees that it has no, and
will not assert any, defenses, counterclaims or offsets to the Loan and AMENDED
AND RESTATED RIDER A and acknowledges and agrees that the Trustee holds a
first-priority security interest in the Collateral.
7. Any default or other breach of any obligation under the
GECC Modification, the DVI Modification, or any of the Related Loan
Modifications shall constitute a default under the Loan as modified by this
Agreement, and USBPS shall have all remedies thereunder.
3
8. Radnet hereby releases the Noteholder, USBPS individually
and as agent for the Trustee and the special purpose entities for which the
Trustee holds collateral, from and against any claims, loss or damage of any
kind or nature arising out of the Loan.
9. So long as any of the Obligations remain outstanding,
Radnet Management, Inc. (the "COMPANY") agrees as follows:
(i) FINANCIAL REPORTING. The Company shall furnish
the following documents or information to USBPS:
(A) Within 30 days after the end of each
Fiscal Quarter (as defined below) (i) (or 90 days in respect of the last month
of the fiscal year), the Company's consolidated, consolidating and on a center
by center basis, financial statements, including the most recent annual report,
balance sheet (not on a center by center basis) and income statement, prepared
in accordance with generally accepted accounting principles, which reports, the
Company warrants, shall fully and fairly represent the true financial condition
of the Company and (ii) updated projections for the Company and for each center;
(B) any other financial information normally
provided by the Company to the public; and
(C) Such other financial data or information
relative to this Amendment Agreement, including, without limitation, listings of
serial numbers or other identification data and confirmations of such
information, as USBPS may time-to-time reasonably request.
(ii) NO AMENDMENTS. Subsequent to the date of this
Amendment Agreement, the Company will not agree or consent to any amendments or
modifications to any agreement between the Company and DVI, GECC or Xxxxx Fargo
Foothill, Inc. ("FOOTHILL") containing terms (including, but not limited to,
increasing interest rates, accelerating the principal amortization or maturity,
new or more stringent defaults, additional collateral, and new remedies
provisions) that would be more onerous to the Company, or adversely impact or
affect GECC with respect to the terms of this Amendment Agreement.
(iii) DISTRIBUTIONS. The Company shall not make any
distribution or declare or pay any dividends (in cash or other property, other
than common stock) on, or purchase, acquire, redeem, or retire any of the
Company's stock, of any class, whether now or hereafter outstanding
(collectively, "DISTRIBUTIONS"); PROVIDED, HOWEVER, that so long as no default
shall have occurred and be continuing immediately prior to or after giving
4
effect to any such payment, (a) the Company may make Distributions to Primedex
Health Systems, Inc., a New York corporation (the "PARENT") (1) in amounts
necessary to pay customary expenses of Parent in the ordinary course of its
business as a public holding company (including salaries and related reasonable
and customary expenses incurred by employees of Parent) in an aggregate amount
not to exceed $750,000 in any fiscal year, (2) in amounts necessary to enable
Parent to pay taxes when due and owing by it in the ordinary course of its
business as a holding company and (3) in amounts necessary to enable Parent to
pay interest on those certain 11.5% Series A Convertible Subordinated Notes due
June 30, 2008, issued by Parent on June 25, 1993, and (b) Parent may make
Distributions in the form of common stock.
(iv) FIXED CHARGE COVERAGE RATIO. Commencing April
30, 2005, the Company shall not permit the Fixed Charge Coverage Ratio, (a) to
be less than 1.0:1 as of the end of each April, July, October and January (each,
a "FISCAL QUARTER") ending prior to January 1, 2007, and (b) to be less than
1.05:1 as of the last day of each Fiscal Quarter ending thereafter. "FIXED
CHARGE COVERAGE RATIO" means for any period, the ratio of (i) EBITDA for such
period MINUS cash capital expenditures made (to the extent not already incurred
in a prior period) or incurred during such period, to (ii) the sum of (a)
interest expense, (b) principal payments required to be paid during such period
in respect of indebtedness, and (c) all federal, state, and local income taxes
accrued, all as determined for the twelve months ending on the determination
date for the Company and its subsidiaries on a consolidated basis without
duplication and in accordance with generally accepted accounting principles
consistently applied. "EBITDA" means, with respect to any fiscal period, the
Company's and its subsidiaries' consolidated net earnings (or loss), minus
extraordinary gains and interest income, plus interest expense, income taxes,
and depreciation and amortization for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(v) LEVERAGE RATIO. The Company shall not permit the
Leverage Ratio, as determined as of the end of each Fiscal Quarter, to be
greater than the amount set forth in the following table for the Fiscal Quarters
ending in the period set forth opposite thereto:
LEVERAGE RATIO Period
-------------- ------
4.50:1.0 04/30/05 - 10/30/05
4.30:1.0 10/31/05 - 10/30/06
4.00:1.0 10/31/06 - 10/30/07
3.80:1.0 10/31/07 - 10/30/08
"LEVERAGE RATIO" means, at any date of determination, the
ratio of (a) Total Debt at such date to (b) EBITDA for the applicable period
ending on such date. "TOTAL DEBT" means, as of any date of determination,
without duplication, the sum of (a) the outstanding aggregate amount of the
obligations for borrowed money, (b) the outstanding principal amount of capital
leases, (c) the outstanding principal amount of purchase money indebtedness, (d)
the outstanding principal amount of funded debt, and (e) the outstanding
5
principal amount of all obligations owing to GECC, DVI and USBPS; all as
determined for the Company and its subsidiaries on a consolidated basis without
duplication and in accordance with generally accepted accounting principles
consistently applied.
(vi) EBITDA MARGIN. The Company shall not permit the
EBITDA Margin to be less than 25% as of the end of any Fiscal Quarter ending on
or after April 30, 2005. "EBITDA MARGIN" means for any period, the ratio of (a)
EBITDA for such period, to (b) net revenues (excluding the professional service
fee component of radiology services) for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(vii) RECEIVABLE DAYS. The Company shall not permit
the Receivable Days to exceed 65 days as of the end of any Fiscal Quarter ending
on or after April 30, 2005. "RECEIVABLE DAYS" means for any period, a number
equal to (a) 365 divided by (b) the result of (i) net revenues for such period
divided by (ii) net receivables for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(viii) NAME CHANGES, ETC. The Company agrees that it
shall not change its name or jurisdiction of organization without giving 30 days
prior written notice to USBPS.
10. To induce USBPS on behalf of the Trustee to enter this
Agreement, the Guarantor hereby affirms and restates its Guarantee as related to
this Loan and AMENDED AND RESTATED RIDER A.
11. Radnet, the Company and the Guarantor each represent and
warrant that each has been represented by an attorney of its choice and is fully
aware of the terms contained in this Agreement and AMENDED AND RESTATED RIDER A
to which it is a party which was voluntarily entered into without coercion or
duress of any kind.
12. Radnet represents and warrants to USBPS on behalf of the
Noteholders and Trustee that all necessary actions on the part of Radnet to be
taken in connection with the execution, delivery and performance of this
Agreement have been taken; the performance by Radnet of this Agreement and the
AMENDED AND RESTATED RIDER A will not violate any of Radnet's Articles of
Incorporation, Articles of Formation, Partnership Agreement or other agreement
or law by which Radnet is bound.
6
13. Any notice, request, direction, consent, approval, waiver
or other communication required or permitted under this Agreement to be sent
must be in writing and will become effective only upon delivery to USBPS at the
address set forth herein as follows:
U.S. Bank Portfolio Services
0000 Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxx, XX 00000
Attn: Xxxx Xxx, Director of Operations
14. Except as provided herein, and in the AMENDED AND RESTATED
RIDER A, all of the other provisions of the Loan Documents not restated will
remain in effect.
15. This Agreement and the documents referenced herein
constitute the entire and final agreement among the parties with respect to the
subject matter hereof and there are no agreements, understandings, warranties or
representations among the parties with respect to these matters except as set
forth herein.
16. This Agreement will inure to the benefit of and bind the
parties and their respective successors and permitted assigns.
17. Neither this Agreement nor any of the provisions hereof
can be changed, waived, discharged or terminated except by an instrument in
writing signed by the parties against whom such enforcement of the change,
waiver, discharge or termination is sought.
18. This Agreement will be interpreted and construed under the
laws of the Commonwealth of Pennsylvania, regardless of the domicile of any
party and will be considered to have been made, executed and performed in
Pennsylvania.
7
19. THE UNDERSIGNED, AND SUBJECT TO THE PROVISIONS CONTAINED
HEREIN, USBPS FOR ITSELF AND AS AGENT FOR THE TRUSTEE, (A) AGREE TO SUBMIT FOR
THEMSELVES, IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT AND ANY
SCHEDULE OR FOR RECOGNITION AND ENFORCEMENT OF ANY JUDGMENT IN RESPECT HEREOF OR
THEREOF, TO THE EXCLUSIVE JURISDICTION OF THE COURTS OF THE COMONWEALTH OF
PENNSYLVANIA, THE COURTS OF THE UNITED STATES OF AMERICA FOR THE EASTERN
DISTRICT OF PENNSYLVANIA, AND APPELLATE COURTS FROM ANY THEREOF, (B) CONSENT
THAT ANY ACTION OR PROCEEDING SHALL BE BROUGHT IN SUCH COURTS, AND WAIVE ANY
OBJECTION THAT EACH MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH ACTION OR
PROCEEDING IN ANY SUCH COURT, (C) AGREE THAT SERVICE OF PROCESS OF ANY SUCH
ACTION OR PROCEEDING MAY BE EFFECTED BY CERTIFIED MAIL (OR ANY SUBSTANTIALLY
SIMILAR FORM OF MAIL), POSTAGE PREPAID, TO THE APPROPRIATE PARTY AT ITS ADDRESS
AS SET FORTH HEREIN, AND SERVICE MADE SHALL BE DEEMED TO BE COMPLETED UPON THE
EARLIER OF ACTUAL RECEIPT OR FIVE (5) DAYS AFTER THE SAME SHALL HAVE BEEN POSTED
AS AFORESAID, AND (D) AGREE THAT NOTHING HEREIN OR IN ANY EXHIBIT OR SCHEDULE
SHALL AFFECT THE RIGHT TO EFFECT SERVICE OF PROCESS IN ANY OTHER MANNER
PERMITTED BY LAW. USBPS AND THE UNDERSIGNED EACH HEREBY UNCONDITIONALLY WAIVES
ITS RIGHT TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING
OUT OF, DIRECTLY OR INDIRECTLY, THIS AGREEMENT, ANY EXHIBIT AND THE TRANSACTIONS
8
CONTEMPLATED HEREBY AND THEREBY, ANY OF THE RELATED DOCUMENTS, ANY DEALINGS
BETWEEN THE PARTIES HERETO RELATING TO THE SUBJECT MATTER HEREOF OR THEREOF,
AND/OR THE RELATIONSHIP THAT IS BEING ESTABLISHED BETWEEN USBPS AS AGENT FOR THE
TRUSTEE AND THE UNDERSIGNED, PROVIDED USBPS MAY IN ITS DISCRETION ENFORCE THE
TERMS OF THE FORUM SELECTION PROVISIONS IN THE LOANS.
20. Radnet, the Company and the Guarantor hereby release
USBPS, the Trustee, and the Noteholders from and against any claim, loss, or
damage arising out of the negotiation execution, and performance of the Loan or
related matters prior to the date hereof.
21. This Agreement may be executed in two or more counterparts
and each counterpart shall be deemed an original.
9
LYON FINANCIAL SERVICES, INC. DBA U.S. BANK
PORTFOLIO SERVICES, AS SERVICER FOR DVI
RECEIVABLES XV, L.L.C. AND AS AGENT FOR U.S.
BANK, N.A., AS TRUSTEE
By:_________________________________________
RADNET MANAGEMENT, INC.
By:_________________________________________
ACKNOWLEDGED AND AGREED TO:
Primedex Health Systems, Inc., Guarantor
By:_________________________________________
10
AMENDMENT TO LOAN DOCUMENTS
---------------------------
AGREEMENT made as of June 30, 2004 ("AMENDMENT AGREEMENT" or
"AGREEMENT") by and between LYON FINANCIAL SERVICES, INC. DBA U.S. BANK
PORTFOLIO SERVICES, as Servicer for DVI Receivables XV, L.L.C. and as Agent for
U.S. Bank, N.A., as Trustee, with offices at 0000 Xxxxxx Xxxxxx, Xxxxx 000,
Xxxxxxxx, Xxxxxxxxx 00000 ("USBPS") and Radnet Management, Inc., a corporation,
with offices at 0000 Xxxxxx Xxxxxx, Xxx Xxxxxxx, XX 00000 ("RADNET"), and such
other signatories hereto.
WHEREAS, on or about July 11, 2001, Radnet executed and
delivered to DVI Financial Services Inc. ("DVI") a Master Loan Agreement
collectively with the Secured Promissory Note Number #3155-014 dated August 15,
2001 (the "LOAN");
WHEREAS, to secure the payment of the Loan and all other
obligations of Radnet to DVI (collectively the "OBLIGATIONS"), Radnet, pursuant
to a Master Security Agreement dated on or about July 11, 2001 (the "SECURITY
AGREEMENT"), granted DVI a first priority security interest in certain
Collateral described therein;
WHEREAS, to further secure payment of the Note and all other
Obligations of Radnet to DVI, Radnet delivered to DVI the guarantee (the
"GUARANTEE") of Primedex Health Systems, Inc. (the "GUARANTOR") (the "GUARANTEE"
together with the Loan and ancillary documents are, collectively the "LOAN
DOCUMENTS");
WHEREAS, substantially contemporaneously therewith, DVI
contributed all of the Loan Documents to DVI Receivables XV, L.L.C. ("DVI XV")
and thereafter pursuant to an Amended and Restated Indenture, DVI XV granted a
first priority security interest in and pledged all of the Loan Documents in
favor of U.S. Bank, N.A., as Trustee, for the benefit of a noteholder which
purchased asset backed promissory notes issued by DVI XV (the "Noteholder");
WHEREAS, DVI contributed other Loans with Radnet or certain
affiliates of Radnet to this and other DVI securitizations (collectively the
"RELATED LOANS");
WHEREAS, Radnet is in default under the terms of the Loan;
WHEREAS, Radnet has requested USBPS to modify the Loan to
reflect an adjustment in payments;
WHEREAS, Radnet and/or certain of its affiliates have agreed
to modify the Related Loans;
WHEREAS, Radnet and certain of its affiliates are engaged in
negotiations to restructure or modify certain loan agreements, loans and
promissory notes with each of General Electric Capital Corporation ("GECC") and
DVI (with respect to GECC, the "GECC MODIFICATION", and with respect to DVI, the
"DVI MODIFICATION");
WHEREAS, subject to the following terms and conditions, USBPS
is willing to modify the Loan as hereinafter provided.
NOW, THEREFORE, the parties agree as follows:
1. All of the Whereas clauses are incorporated herein as if
hereinafter set forth at full length.
2. Radnet acknowledges that it is duly indebted to the Trustee
in the sum set forth on AMENDED AND RESTATED RIDER A annexed hereto, and has no
defenses, counterclaims or offsets to such indebtedness.
3. USBPS as Agent for the Trustee will modify the Loan to
provide for payments to commence in accordance with the attached revised payment
schedule (the "AMENDED AND RESTATED RIDER A"). Radnet may, at any time, prepay
all of the then outstanding Obligations subject to an additional prepayment fee
of 2% of such Obligations. Partial prepayments of the Obligations shall not be
permitted at any time.
2
4. This Agreement shall become effective upon the date that
USBPS receives this Agreement duly executed by Radnet and the satisfaction of
each of the following conditions:
(a) Radnet and/or its affiliates shall have entered
into agreements on similar terms to this Agreement and
otherwise in form and substance satisfactory to USBPS,
relating to the Related Loans (the "Related Loan
Modifications");
(b) reimbursement of USBPS's legal fees incurred in
connection with the execution of this Agreement and the
Related Loan Modifications, aggregating $50,000, shall have
been received by USBPS;
(c) Radnet and/or its affiliates shall have entered
into the GECC Modification and the DVI Modification.
5. The closing of the restructuring of the Radnet Loan is
further subject to delivery to USBPS of all of the following, each in form and
substance satisfactory to USBPS and its counsel:
(a) The executed AMENDED AND RESTATED RIDER A;
(b) An executed copy of this Agreement;
(c) Such other documents, including UCC financing
statements as USBPS reasonably requests.
6. Radnet hereby acknowledges and agrees that it has no, and
will not assert any, defenses, counterclaims or offsets to the Loan and AMENDED
AND RESTATED RIDER A and acknowledges and agrees that the Trustee holds a
first-priority security interest in the Collateral.
7. Any default or other breach of any obligation under the
GECC Modification, the DVI Modification, or any of the Related Loan
Modifications shall constitute a default under the Loan as modified by this
Agreement, and USBPS shall have all remedies thereunder.
3
8. Radnet hereby releases the Noteholder, USBPS individually
and as agent for the Trustee and the special purpose entities for which the
Trustee holds collateral, from and against any claims, loss or damage of any
kind or nature arising out of the Loan.
9. So long as any of the Obligations remain outstanding,
Radnet Management, Inc. (the "COMPANY") agrees as follows:
(i) FINANCIAL REPORTING. The Company shall furnish
the following documents or information to USBPS:
(A) Within 30 days after the end of each
Fiscal Quarter (as defined below) (i) (or 90 days in respect of the last month
of the fiscal year), the Company's consolidated, consolidating and on a center
by center basis, financial statements, including the most recent annual report,
balance sheet (not on a center by center basis) and income statement, prepared
in accordance with generally accepted accounting principles, which reports, the
Company warrants, shall fully and fairly represent the true financial condition
of the Company and (ii) updated projections for the Company and for each center;
(B) any other financial information normally
provided by the Company to the public; and
(C) Such other financial data or information
relative to this Amendment Agreement, including, without limitation, listings of
serial numbers or other identification data and confirmations of such
information, as USBPS may time-to-time reasonably request.
(ii) NO AMENDMENTS. Subsequent to the date of this
Amendment Agreement, the Company will not agree or consent to any amendments or
modifications to any agreement between the Company and DVI, GECC or Xxxxx Fargo
Foothill, Inc. ("FOOTHILL") containing terms (including, but not limited to,
increasing interest rates, accelerating the principal amortization or maturity,
new or more stringent defaults, additional collateral, and new remedies
provisions) that would be more onerous to the Company, or adversely impact or
affect GECC with respect to the terms of this Amendment Agreement.
(iii) DISTRIBUTIONS. The Company shall not make any
distribution or declare or pay any dividends (in cash or other property, other
than common stock) on, or purchase, acquire, redeem, or retire any of the
Company's stock, of any class, whether now or hereafter outstanding
(collectively, "DISTRIBUTIONS"); PROVIDED, HOWEVER, that so long as no default
shall have occurred and be continuing immediately prior to or after giving
4
effect to any such payment, (a) the Company may make Distributions to Primedex
Health Systems, Inc., a New York corporation (the "PARENT") (1) in amounts
necessary to pay customary expenses of Parent in the ordinary course of its
business as a public holding company (including salaries and related reasonable
and customary expenses incurred by employees of Parent) in an aggregate amount
not to exceed $750,000 in any fiscal year, (2) in amounts necessary to enable
Parent to pay taxes when due and owing by it in the ordinary course of its
business as a holding company and (3) in amounts necessary to enable Parent to
pay interest on those certain 11.5% Series A Convertible Subordinated Notes due
June 30, 2008, issued by Parent on June 25, 1993, and (b) Parent may make
Distributions in the form of common stock.
(iv) FIXED CHARGE COVERAGE RATIO. Commencing April
30, 2005, the Company shall not permit the Fixed Charge Coverage Ratio, (a) to
be less than 1.0:1 as of the end of each April, July, October and January (each,
a "FISCAL QUARTER") ending prior to January 1, 2007, and (b) to be less than
1.05:1 as of the last day of each Fiscal Quarter ending thereafter. "FIXED
CHARGE COVERAGE RATIO" means for any period, the ratio of (i) EBITDA for such
period MINUS cash capital expenditures made (to the extent not already incurred
in a prior period) or incurred during such period, to (ii) the sum of (a)
interest expense, (b) principal payments required to be paid during such period
in respect of indebtedness, and (c) all federal, state, and local income taxes
accrued, all as determined for the twelve months ending on the determination
date for the Company and its subsidiaries on a consolidated basis without
duplication and in accordance with generally accepted accounting principles
consistently applied. "EBITDA" means, with respect to any fiscal period, the
Company's and its subsidiaries' consolidated net earnings (or loss), minus
extraordinary gains and interest income, plus interest expense, income taxes,
and depreciation and amortization for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(v) LEVERAGE RATIO. The Company shall not permit the
Leverage Ratio, as determined as of the end of each Fiscal Quarter, to be
greater than the amount set forth in the following table for the Fiscal Quarters
ending in the period set forth opposite thereto:
LEVERAGE RATIO Period
-------------- ------
4.50:1.0 04/30/05 - 10/30/05
4.30:1.0 10/31/05 - 10/30/06
4.00:1.0 10/31/06 - 10/30/07
3.80:1.0 10/31/07 - 10/30/08
"LEVERAGE RATIO" means, at any date of determination, the
ratio of (a) Total Debt at such date to (b) EBITDA for the applicable period
ending on such date. "TOTAL DEBT" means, as of any date of determination,
without duplication, the sum of (a) the outstanding aggregate amount of the
obligations for borrowed money, (b) the outstanding principal amount of capital
leases, (c) the outstanding principal amount of purchase money indebtedness, (d)
the outstanding principal amount of funded debt, and (e) the outstanding
principal amount of all obligations owing to GECC, DVI and USBPS; all as
5
determined for the Company and its subsidiaries on a consolidated basis without
duplication and in accordance with generally accepted accounting principles
consistently applied.
(vi) EBITDA MARGIN. The Company shall not permit the
EBITDA Margin to be less than 25% as of the end of any Fiscal Quarter ending on
or after April 30, 2005. "EBITDA MARGIN" means for any period, the ratio of (a)
EBITDA for such period, to (b) net revenues (excluding the professional service
fee component of radiology services) for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(vii) RECEIVABLE DAYS. The Company shall not permit
the Receivable Days to exceed 65 days as of the end of any Fiscal Quarter ending
on or after April 30, 2005. "RECEIVABLE DAYS" means for any period, a number
equal to (a) 365 divided by (b) the result of (i) net revenues for such period
divided by (ii) net receivables for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(viii) NAME CHANGES, ETC. The Company agrees that it
shall not change its name or jurisdiction of organization without giving 30 days
prior written notice to USBPS.
10. To induce USBPS on behalf of the Trustee to enter this
Agreement, the Guarantor hereby affirms and restates its Guarantee as related to
this Loan and AMENDED AND RESTATED RIDER A.
11. Radnet, the Company and the Guarantor each represent and
warrant that each has been represented by an attorney of its choice and is fully
aware of the terms contained in this Agreement and AMENDED AND RESTATED RIDER A
to which it is a party which was voluntarily entered into without coercion or
duress of any kind.
12. Radnet represents and warrants to USBPS on behalf of the
Noteholders and Trustee that all necessary actions on the part of Radnet to be
taken in connection with the execution, delivery and performance of this
Agreement have been taken; the performance by Radnet of this Agreement and the
AMENDED AND RESTATED RIDER A will not violate any of Radnet's Articles of
6
Incorporation, Articles of Formation, Partnership Agreement or other agreement
or law by which Radnet is bound.
13. Any notice, request, direction, consent, approval, waiver
or other communication required or permitted under this Agreement to be sent
must be in writing and will become effective only upon delivery to USBPS at the
address set forth herein as follows:
U.S. Bank Portfolio Services
0000 Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxx, XX 00000
Attn: Xxxx Xxx, Director of Operations
14. Except as provided herein, and in the AMENDED AND RESTATED
RIDER A, all of the other provisions of the Loan Documents not restated will
remain in effect.
15. This Agreement and the documents referenced herein
constitute the entire and final agreement among the parties with respect to the
subject matter hereof and there are no agreements, understandings, warranties or
representations among the parties with respect to these matters except as set
forth herein.
16. This Agreement will inure to the benefit of and bind the
parties and their respective successors and permitted assigns.
17. Neither this Agreement nor any of the provisions hereof
can be changed, waived, discharged or terminated except by an instrument in
writing signed by the parties against whom such enforcement of the change,
waiver, discharge or termination is sought.
18. This Agreement will be interpreted and construed under the
laws of the Commonwealth of Pennsylvania, regardless of the domicile of any
party and will be considered to have been made, executed and performed in
Pennsylvania.
7
19. THE UNDERSIGNED, AND SUBJECT TO THE PROVISIONS CONTAINED
HEREIN, USBPS FOR ITSELF AND AS AGENT FOR THE TRUSTEE, (A) AGREE TO SUBMIT FOR
THEMSELVES, IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT AND ANY
SCHEDULE OR FOR RECOGNITION AND ENFORCEMENT OF ANY JUDGMENT IN RESPECT HEREOF OR
THEREOF, TO THE EXCLUSIVE JURISDICTION OF THE COURTS OF THE COMONWEALTH OF
PENNSYLVANIA, THE COURTS OF THE UNITED STATES OF AMERICA FOR THE EASTERN
DISTRICT OF PENNSYLVANIA, AND APPELLATE COURTS FROM ANY THEREOF, (B) CONSENT
THAT ANY ACTION OR PROCEEDING SHALL BE BROUGHT IN SUCH COURTS, AND WAIVE ANY
OBJECTION THAT EACH MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH ACTION OR
PROCEEDING IN ANY SUCH COURT, (C) AGREE THAT SERVICE OF PROCESS OF ANY SUCH
ACTION OR PROCEEDING MAY BE EFFECTED BY CERTIFIED MAIL (OR ANY SUBSTANTIALLY
SIMILAR FORM OF MAIL), POSTAGE PREPAID, TO THE APPROPRIATE PARTY AT ITS ADDRESS
AS SET FORTH HEREIN, AND SERVICE MADE SHALL BE DEEMED TO BE COMPLETED UPON THE
EARLIER OF ACTUAL RECEIPT OR FIVE (5) DAYS AFTER THE SAME SHALL HAVE BEEN POSTED
AS AFORESAID, AND (D) AGREE THAT NOTHING HEREIN OR IN ANY EXHIBIT OR SCHEDULE
SHALL AFFECT THE RIGHT TO EFFECT SERVICE OF PROCESS IN ANY OTHER MANNER
PERMITTED BY LAW. USBPS AND THE UNDERSIGNED EACH HEREBY UNCONDITIONALLY WAIVES
ITS RIGHT TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING
OUT OF, DIRECTLY OR INDIRECTLY, THIS AGREEMENT, ANY EXHIBIT AND THE TRANSACTIONS
8
CONTEMPLATED HEREBY AND THEREBY, ANY OF THE RELATED DOCUMENTS, ANY DEALINGS
BETWEEN THE PARTIES HERETO RELATING TO THE SUBJECT MATTER HEREOF OR THEREOF,
AND/OR THE RELATIONSHIP THAT IS BEING ESTABLISHED BETWEEN USBPS AS AGENT FOR THE
TRUSTEE AND THE UNDERSIGNED, PROVIDED USBPS MAY IN ITS DISCRETION ENFORCE THE
TERMS OF THE FORUM SELECTION PROVISIONS IN THE LOANS.
20. Radnet, the Company and the Guarantor hereby release
USBPS, the Trustee, and the Noteholders from and against any claim, loss, or
damage arising out of the negotiation execution, and performance of the Loan or
related matters prior to the date hereof.
21. This Agreement may be executed in two or more counterparts
and each counterpart shall be deemed an original.
9
LYON FINANCIAL SERVICES, INC. DBA U.S. BANK
PORTFOLIO SERVICES, AS SERVICER FOR DVI
RECEIVABLES XV, L.L.C. AND AS AGENT FOR U.S.
BANK, N.A., AS TRUSTEE
By:_________________________________________
RADNET MANAGEMENT, INC.
By:_________________________________________
ACKNOWLEDGED AND AGREED TO:
Primedex Health Systems, Inc., Guarantor
By:_________________________________________
10
AMENDMENT TO LOAN DOCUMENTS
---------------------------
AGREEMENT made as of June 30, 2004 ("AMENDMENT AGREEMENT" or
"AGREEMENT") by and between LYON FINANCIAL SERVICES, INC. DBA U.S. BANK
PORTFOLIO SERVICES, as Successor Servicer for DVI Receivables XVII, L.L.C. and
as Agent for U.S. Bank, N.A., as Trustee, with offices at 0000 Xxxxxx Xxxxxx,
Xxxxx 000, Xxxxxxxx, Xxxxxxxxx 00000 ("USBPS") and Radnet Management, Inc., a
corporation, with offices at 0000 Xxxxxx Xxxxxx, Xxx Xxxxxxx, XX 00000
("RADNET"), and such other signatories hereto.
WHEREAS, on or about July 11, 2001, Radnet executed and
delivered to DVI Financial Services Inc. ("DVI") a Master Loan Agreement
collectively with the Secured Promissory Note Number #3155-013 dated September
19, 2001 (the "LOAN");
WHEREAS, to secure the payment of the Loan and all other
obligations of Radnet to DVI (collectively the "OBLIGATIONS"), Radnet, pursuant
to a Master Security Agreement dated on or about July 11, 2001 (the "SECURITY
AGREEMENT"), granted DVI a first priority security interest in certain
Collateral described therein;
WHEREAS, to further secure payment of the Note and all other
Obligations of Radnet to DVI, Radnet delivered to DVI the guarantee (the
"GUARANTEE") of Primedex Health Systems, Inc. (the "GUARANTOR") (the "GUARANTEE"
together with the Loan and ancillary documents are, collectively the "LOAN
DOCUMENTS");
WHEREAS, substantially contemporaneously therewith, DVI
contributed all of the Loan Documents to DVI Receivables XVII, L.L.C. ("DVI
XVII") and thereafter pursuant to an Amended and Restated Indenture, DVI XVII
granted a first priority security interest in and pledged all of the Loan
Documents in favor of U.S. Bank, N.A., as Trustee, for the benefit of a
noteholder which purchased asset backed promissory notes issued by DVI XVII (the
"Noteholder");
WHEREAS, DVI contributed other Loans with Radnet or certain
affiliates of Radnet to this and other DVI securitizations (collectively the
"RELATED LOANS");
WHEREAS, Radnet is in default under the terms of the Loan;
WHEREAS, Radnet has requested USBPS to modify the Loan to
reflect an adjustment in payments;
WHEREAS, Radnet and/or certain of its affiliates have agreed
to modify the Related Loans;
WHEREAS, Radnet and certain of its affiliates are engaged in
negotiations to restructure or modify certain loan agreements, loans and
promissory notes with each of General Electric Capital Corporation ("GECC") and
DVI (with respect to GECC, the "GECC MODIFICATION", and with respect to DVI, the
"DVI MODIFICATION");
WHEREAS, subject to the following terms and conditions, USBPS
is willing to modify the Loan as hereinafter provided.
NOW, THEREFORE, the parties agree as follows:
1. All of the Whereas clauses are incorporated herein as if
hereinafter set forth at full length.
2. Radnet acknowledges that it is duly indebted to the Trustee
in the sum set forth on AMENDED AND RESTATED RIDER A annexed hereto, and has no
defenses, counterclaims or offsets to such indebtedness.
3. USBPS as Agent for the Trustee will modify the Loan to
provide for payments to commence in accordance with the attached revised payment
schedule (the "AMENDED AND RESTATED RIDER A"). Radnet may, at any time, prepay
2
all of the then outstanding Obligations subject to an additional prepayment fee
of 2% of such Obligations. Partial prepayments of the Obligations shall not be
permitted at any time.
4. This Agreement shall become effective upon the date that
USBPS receives this Agreement duly executed by Radnet and the satisfaction of
each of the following conditions:
(a) Radnet and/or its affiliates shall have entered
into agreements on similar terms to this Agreement and
otherwise in form and substance satisfactory to USBPS,
relating to the Related Loans (the "Related Loan
Modifications");
(b) reimbursement of USBPS's legal fees incurred in
connection with the execution of this Agreement and the
Related Loan Modifications, aggregating $50,000, shall have
been received by USBPS;
(c) Radnet and/or its affiliates shall have entered
into the GECC Modification and the DVI Modification.
5. The closing of the restructuring of the Radnet Loan is
further subject to delivery to USBPS of all of the following, each in form and
substance satisfactory to USBPS and its counsel:
(a) The executed AMENDED AND RESTATED RIDER A;
(b) An executed copy of this Agreement;
(c) Such other documents, including UCC financing
statements as USBPS reasonably requests.
6. Radnet hereby acknowledges and agrees that it has no, and
will not assert any, defenses, counterclaims or offsets to the Loan and AMENDED
AND RESTATED RIDER A and acknowledges and agrees that the Trustee holds a
first-priority security interest in the Collateral.
7. Any default or other breach of any obligation under the
GECC Modification, the DVI Modification, or any of the Related Loan
Modifications shall constitute a default under the Loan as modified by this
Agreement, and USBPS shall have all remedies thereunder.
3
8. Radnet hereby releases the Noteholder, USBPS individually
and as agent for the Trustee and the special purpose entities for which the
Trustee holds collateral, from and against any claims, loss or damage of any
kind or nature arising out of the Loan.
9. So long as any of the Obligations remain outstanding,
Radnet Management, Inc. (the "COMPANY") agrees as follows:
(i) FINANCIAL REPORTING. The Company shall furnish
the following documents or information to USBPS:
(A) Within 30 days after the end of each
Fiscal Quarter (as defined below) (i) (or 90 days in respect of the last month
of the fiscal year), the Company's consolidated, consolidating and on a center
by center basis, financial statements, including the most recent annual report,
balance sheet (not on a center by center basis) and income statement, prepared
in accordance with generally accepted accounting principles, which reports, the
Company warrants, shall fully and fairly represent the true financial condition
of the Company and (ii) updated projections for the Company and for each center;
(B) any other financial information normally
provided by the Company to the public; and
(C) Such other financial data or information
relative to this Amendment Agreement, including, without limitation, listings of
serial numbers or other identification data and confirmations of such
information, as USBPS may time-to-time reasonably request.
(ii) NO AMENDMENTS. Subsequent to the date of this
Amendment Agreement, the Company will not agree or consent to any amendments or
modifications to any agreement between the Company and DVI, GECC or Xxxxx Fargo
Foothill, Inc. ("FOOTHILL") containing terms (including, but not limited to,
increasing interest rates, accelerating the principal amortization or maturity,
new or more stringent defaults, additional collateral, and new remedies
provisions) that would be more onerous to the Company, or adversely impact or
affect GECC with respect to the terms of this Amendment Agreement.
(iii) DISTRIBUTIONS. The Company shall not make any
distribution or declare or pay any dividends (in cash or other property, other
than common stock) on, or purchase, acquire, redeem, or retire any of the
Company's stock, of any class, whether now or hereafter outstanding
(collectively, "DISTRIBUTIONS"); PROVIDED, HOWEVER, that so long as no default
shall have occurred and be continuing immediately prior to or after giving
4
effect to any such payment, (a) the Company may make Distributions to Primedex
Health Systems, Inc., a New York corporation (the "PARENT") (1) in amounts
necessary to pay customary expenses of Parent in the ordinary course of its
business as a public holding company (including salaries and related reasonable
and customary expenses incurred by employees of Parent) in an aggregate amount
not to exceed $750,000 in any fiscal year, (2) in amounts necessary to enable
Parent to pay taxes when due and owing by it in the ordinary course of its
business as a holding company and (3) in amounts necessary to enable Parent to
pay interest on those certain 11.5% Series A Convertible Subordinated Notes due
June 30, 2008, issued by Parent on June 25, 1993, and (b) Parent may make
Distributions in the form of common stock.
(iv) FIXED CHARGE COVERAGE RATIO. Commencing April
30, 2005, the Company shall not permit the Fixed Charge Coverage Ratio, (a) to
be less than 1.0:1 as of the end of each April, July, October and January (each,
a "FISCAL QUARTER") ending prior to January 1, 2007, and (b) to be less than
1.05:1 as of the last day of each Fiscal Quarter ending thereafter. "FIXED
CHARGE COVERAGE RATIO" means for any period, the ratio of (i) EBITDA for such
period MINUS cash capital expenditures made (to the extent not already incurred
in a prior period) or incurred during such period, to (ii) the sum of (a)
interest expense, (b) principal payments required to be paid during such period
in respect of indebtedness, and (c) all federal, state, and local income taxes
accrued, all as determined for the twelve months ending on the determination
date for the Company and its subsidiaries on a consolidated basis without
duplication and in accordance with generally accepted accounting principles
consistently applied. "EBITDA" means, with respect to any fiscal period, the
Company's and its subsidiaries' consolidated net earnings (or loss), minus
extraordinary gains and interest income, plus interest expense, income taxes,
and depreciation and amortization for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(v) LEVERAGE RATIO. The Company shall not permit the
Leverage Ratio, as determined as of the end of each Fiscal Quarter, to be
greater than the amount set forth in the following table for the Fiscal Quarters
ending in the period set forth opposite thereto:
LEVERAGE RATIO Period
-------------- ------
4.50:1.0 04/30/05 - 10/30/05
4.30:1.0 10/31/05 - 10/30/06
4.00:1.0 10/31/06 - 10/30/07
3.80:1.0 10/31/07 - 10/30/08
"LEVERAGE RATIO" means, at any date of determination, the
ratio of (a) Total Debt at such date to (b) EBITDA for the applicable period
ending on such date. "TOTAL DEBT" means, as of any date of determination,
without duplication, the sum of (a) the outstanding aggregate amount of the
obligations for borrowed money, (b) the outstanding principal amount of capital
leases, (c) the outstanding principal amount of purchase money indebtedness, (d)
the outstanding principal amount of funded debt, and (e) the outstanding
principal amount of all obligations owing to GECC, DVI and USBPS; all as
5
determined for the Company and its subsidiaries on a consolidated basis without
duplication and in accordance with generally accepted accounting principles
consistently applied.
(vi) EBITDA MARGIN. The Company shall not permit the
EBITDA Margin to be less than 25% as of the end of any Fiscal Quarter ending on
or after April 30, 2005. "EBITDA MARGIN" means for any period, the ratio of (a)
EBITDA for such period, to (b) net revenues (excluding the professional service
fee component of radiology services) for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(vii) RECEIVABLE DAYS. The Company shall not permit
the Receivable Days to exceed 65 days as of the end of any Fiscal Quarter ending
on or after April 30, 2005. "RECEIVABLE DAYS" means for any period, a number
equal to (a) 365 divided by (b) the result of (i) net revenues for such period
divided by (ii) net receivables for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(viii) NAME CHANGES, ETC. The Company agrees that it
shall not change its name or jurisdiction of organization without giving 30 days
prior written notice to USBPS.
10. To induce USBPS on behalf of the Trustee to enter this
Agreement, the Guarantor hereby affirms and restates its Guarantee as related to
this Loan and AMENDED AND RESTATED RIDER A.
11. Radnet, the Company and the Guarantor each represent and
warrant that each has been represented by an attorney of its choice and is fully
aware of the terms contained in this Agreement and AMENDED AND RESTATED RIDER A
to which it is a party which was voluntarily entered into without coercion or
duress of any kind.
12. Radnet represents and warrants to USBPS on behalf of the
Noteholders and Trustee that all necessary actions on the part of Radnet to be
taken in connection with the execution, delivery and performance of this
Agreement have been taken; the performance by Radnet of this Agreement and the
AMENDED AND RESTATED RIDER A will not violate any of Radnet's Articles of
Incorporation, Articles of Formation, Partnership Agreement or other agreement
or law by which Radnet is bound.
6
13. Any notice, request, direction, consent, approval, waiver
or other communication required or permitted under this Agreement to be sent
must be in writing and will become effective only upon delivery to USBPS at the
address set forth herein as follows:
U.S. Bank Portfolio Services
0000 Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxx, XX 00000
Attn: Xxxx Xxx, Director of Operations
14. Except as provided herein, and in the AMENDED AND RESTATED
RIDER A, all of the other provisions of the Loan Documents not restated will
remain in effect.
15. This Agreement and the documents referenced herein
constitute the entire and final agreement among the parties with respect to the
subject matter hereof and there are no agreements, understandings, warranties or
representations among the parties with respect to these matters except as set
forth herein.
16. This Agreement will inure to the benefit of and bind the
parties and their respective successors and permitted assigns.
17. Neither this Agreement nor any of the provisions hereof
can be changed, waived, discharged or terminated except by an instrument in
writing signed by the parties against whom such enforcement of the change,
waiver, discharge or termination is sought.
18. This Agreement will be interpreted and construed under the
laws of the Commonwealth of Pennsylvania, regardless of the domicile of any
party and will be considered to have been made, executed and performed in
Pennsylvania.
7
19. THE UNDERSIGNED, AND SUBJECT TO THE PROVISIONS CONTAINED
HEREIN, USBPS FOR ITSELF AND AS AGENT FOR THE TRUSTEE, (A) AGREE TO SUBMIT FOR
THEMSELVES, IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT AND ANY
SCHEDULE OR FOR RECOGNITION AND ENFORCEMENT OF ANY JUDGMENT IN RESPECT HEREOF OR
THEREOF, TO THE EXCLUSIVE JURISDICTION OF THE COURTS OF THE COMONWEALTH OF
PENNSYLVANIA, THE COURTS OF THE UNITED STATES OF AMERICA FOR THE EASTERN
DISTRICT OF PENNSYLVANIA, AND APPELLATE COURTS FROM ANY THEREOF, (B) CONSENT
THAT ANY ACTION OR PROCEEDING SHALL BE BROUGHT IN SUCH COURTS, AND WAIVE ANY
OBJECTION THAT EACH MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH ACTION OR
PROCEEDING IN ANY SUCH COURT, (C) AGREE THAT SERVICE OF PROCESS OF ANY SUCH
ACTION OR PROCEEDING MAY BE EFFECTED BY CERTIFIED MAIL (OR ANY SUBSTANTIALLY
SIMILAR FORM OF MAIL), POSTAGE PREPAID, TO THE APPROPRIATE PARTY AT ITS ADDRESS
AS SET FORTH HEREIN, AND SERVICE MADE SHALL BE DEEMED TO BE COMPLETED UPON THE
EARLIER OF ACTUAL RECEIPT OR FIVE (5) DAYS AFTER THE SAME SHALL HAVE BEEN POSTED
AS AFORESAID, AND (D) AGREE THAT NOTHING HEREIN OR IN ANY EXHIBIT OR SCHEDULE
SHALL AFFECT THE RIGHT TO EFFECT SERVICE OF PROCESS IN ANY OTHER MANNER
PERMITTED BY LAW. USBPS AND THE UNDERSIGNED EACH HEREBY UNCONDITIONALLY WAIVES
ITS RIGHT TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING
OUT OF, DIRECTLY OR INDIRECTLY, THIS AGREEMENT, ANY EXHIBIT AND THE TRANSACTIONS
8
CONTEMPLATED HEREBY AND THEREBY, ANY OF THE RELATED DOCUMENTS, ANY DEALINGS
BETWEEN THE PARTIES HERETO RELATING TO THE SUBJECT MATTER HEREOF OR THEREOF,
AND/OR THE RELATIONSHIP THAT IS BEING ESTABLISHED BETWEEN USBPS AS AGENT FOR THE
TRUSTEE AND THE UNDERSIGNED, PROVIDED USBPS MAY IN ITS DISCRETION ENFORCE THE
TERMS OF THE FORUM SELECTION PROVISIONS IN THE LOANS.
20. Radnet, the Company and the Guarantor hereby release
USBPS, the Trustee, and the Noteholders from and against any claim, loss, or
damage arising out of the negotiation execution, and performance of the Loan or
related matters prior to the date hereof.
21. This Agreement may be executed in two or more counterparts
and each counterpart shall be deemed an original.
9
LYON FINANCIAL SERVICES, INC. DBA U.S. BANK
PORTFOLIO SERVICES, AS SUCCESSOR SERVICER
FOR DVI RECEIVABLES XVII, L.L.C. AND AS
AGENT FOR U.S. BANK, N.A., AS TRUSTEE
By:_________________________________________
RADNET MANAGEMENT, INC.
By:_________________________________________
ACKNOWLEDGED AND AGREED TO:
Primedex Health Systems, Inc., Guarantor
By:_________________________________________
10
AMENDMENT TO LOAN DOCUMENTS
---------------------------
AGREEMENT made as of June 30, 2004 ("AMENDMENT AGREEMENT" or
"AGREEMENT") by and between LYON FINANCIAL SERVICES, INC. DBA U.S. BANK
PORTFOLIO SERVICES, as Successor Servicer for DVI Receivables XVIII, L.L.C. and
as Agent for U.S. Bank, N.A., as Trustee, with offices at 0000 Xxxxxx Xxxxxx,
Xxxxx 000, Xxxxxxxx, Xxxxxxxxx 00000 ("USBPS") and Radnet Management, Inc., a
corporation, with offices at 0000 Xxxxxx Xxxxxx, Xxx Xxxxxxx, XX 00000
("RADNET"), and such other signatories hereto.
WHEREAS, on or about July 11, 2001, Radnet executed and
delivered to DVI Financial Services Inc. ("DVI") a Master Loan Agreement
collectively with the Secured Promissory Note Number #3155-011 dated September
13, 2001 (the "LOAN");
WHEREAS, to secure the payment of the Loan and all other
obligations of Radnet to DVI (collectively the "OBLIGATIONS"), Radnet, pursuant
to a Master Security Agreement dated on or about July 11, 2001 (the "SECURITY
AGREEMENT"), granted DVI a first priority security interest in certain
Collateral described therein;
WHEREAS, to further secure payment of the Note and all other
Obligations of Radnet to DVI, Radnet delivered to DVI the guarantee (the
"GUARANTEE") of Primedex Health Systems, Inc. (the "GUARANTOR") (the "GUARANTEE"
together with the Loan and ancillary documents are, collectively the "LOAN
DOCUMENTS");
WHEREAS, substantially contemporaneously therewith, DVI
contributed all of the Loan Documents to DVI Receivables XVIII, L.L.C. ("DVI
XVIII") and thereafter pursuant to an Amended and Restated Indenture, DVI XVIII
granted a first priority security interest in and pledged all of the Loan
Documents in favor of U.S. Bank, N.A., as Trustee, for the benefit of a
noteholder which purchased asset backed promissory notes issued by DVI XVIII
(the "Noteholder");
WHEREAS, DVI contributed other Loans with Radnet or certain
affiliates of Radnet to this and other DVI securitizations (collectively the
"RELATED LOANS");
WHEREAS, Radnet is in default under the terms of the Loan;
WHEREAS, Radnet has requested USBPS to modify the Loan to
reflect an adjustment in payments;
WHEREAS, Radnet and/or certain of its affiliates have agreed
to modify the Related Loans;
WHEREAS, Radnet and certain of its affiliates are engaged in
negotiations to restructure or modify certain loan agreements, loans and
promissory notes with each of General Electric Capital Corporation ("GECC") and
DVI (with respect to GECC, the "GECC MODIFICATION", and with respect to DVI, the
"DVI MODIFICATION");
WHEREAS, subject to the following terms and conditions, USBPS
is willing to modify the Loan as hereinafter provided.
NOW, THEREFORE, the parties agree as follows:
1. All of the Whereas clauses are incorporated herein as if
hereinafter set forth at full length.
2. Radnet acknowledges that it is duly indebted to the Trustee
in the sum set forth on AMENDED AND RESTATED RIDER A annexed hereto, and has no
defenses, counterclaims or offsets to such indebtedness.
3. USBPS as Agent for the Trustee will modify the Loan to
provide for payments to commence in accordance with the attached revised payment
schedule (the "AMENDED AND RESTATED RIDER A"). Radnet may, at any time, prepay
2
all of the then outstanding Obligations subject to an additional prepayment fee
of 2% of such Obligations. Partial prepayments of the Obligations shall not be
permitted at any time.
4. This Agreement shall become effective upon the date that
USBPS receives this Agreement duly executed by Radnet and the satisfaction of
each of the following conditions:
(a) Radnet and/or its affiliates shall have entered
into agreements on similar terms to this Agreement and
otherwise in form and substance satisfactory to USBPS,
relating to the Related Loans (the "Related Loan
Modifications");
(b) reimbursement of USBPS's legal fees incurred in
connection with the execution of this Agreement and the
Related Loan Modifications, aggregating $50,000, shall have
been received by USBPS;
(c) Radnet and/or its affiliates shall have entered
into the GECC Modification and the DVI Modification.
5. The closing of the restructuring of the Radnet Loan is
further subject to delivery to USBPS of all of the following, each in form and
substance satisfactory to USBPS and its counsel:
(a) The executed AMENDED AND RESTATED RIDER A;
(b) An executed copy of this Agreement;
(c) Such other documents, including UCC financing
statements as USBPS reasonably requests.
6. Radnet hereby acknowledges and agrees that it has no, and
will not assert any, defenses, counterclaims or offsets to the Loan and AMENDED
AND RESTATED RIDER A and acknowledges and agrees that the Trustee holds a
first-priority security interest in the Collateral.
7. Any default or other breach of any obligation under the
GECC Modification, the DVI Modification, or any of the Related Loan
Modifications shall constitute a default under the Loan as modified by this
Agreement, and USBPS shall have all remedies thereunder.
3
8. Radnet hereby releases the Noteholder, USBPS individually
and as agent for the Trustee and the special purpose entities for which the
Trustee holds collateral, from and against any claims, loss or damage of any
kind or nature arising out of the Loan.
9. So long as any of the Obligations remain outstanding,
Radnet Management, Inc. (the "COMPANY") agrees as follows:
(i) FINANCIAL REPORTING. The Company shall furnish
the following documents or information to USBPS:
(A) Within 30 days after the end of each
Fiscal Quarter (as defined below) (i) (or 90 days in respect of the last month
of the fiscal year), the Company's consolidated, consolidating and on a center
by center basis, financial statements, including the most recent annual report,
balance sheet (not on a center by center basis) and income statement, prepared
in accordance with generally accepted accounting principles, which reports, the
Company warrants, shall fully and fairly represent the true financial condition
of the Company and (ii) updated projections for the Company and for each center;
(B) any other financial information normally
provided by the Company to the public; and
(C) Such other financial data or information
relative to this Amendment Agreement, including, without limitation, listings of
serial numbers or other identification data and confirmations of such
information, as USBPS may time-to-time reasonably request.
(ii) NO AMENDMENTS. Subsequent to the date of this
Amendment Agreement, the Company will not agree or consent to any amendments or
modifications to any agreement between the Company and DVI, GECC or Xxxxx Fargo
Foothill, Inc. ("FOOTHILL") containing terms (including, but not limited to,
increasing interest rates, accelerating the principal amortization or maturity,
new or more stringent defaults, additional collateral, and new remedies
provisions) that would be more onerous to the Company, or adversely impact or
affect GECC with respect to the terms of this Amendment Agreement.
(iii) DISTRIBUTIONS. The Company shall not make any
distribution or declare or pay any dividends (in cash or other property, other
than common stock) on, or purchase, acquire, redeem, or retire any of the
Company's stock, of any class, whether now or hereafter outstanding
(collectively, "DISTRIBUTIONS"); PROVIDED, HOWEVER, that so long as no default
4
shall have occurred and be continuing immediately prior to or after giving
effect to any such payment, (a) the Company may make Distributions to Primedex
Health Systems, Inc., a New York corporation (the "PARENT") (1) in amounts
necessary to pay customary expenses of Parent in the ordinary course of its
business as a public holding company (including salaries and related reasonable
and customary expenses incurred by employees of Parent) in an aggregate amount
not to exceed $750,000 in any fiscal year, (2) in amounts necessary to enable
Parent to pay taxes when due and owing by it in the ordinary course of its
business as a holding company and (3) in amounts necessary to enable Parent to
pay interest on those certain 11.5% Series A Convertible Subordinated Notes due
June 30, 2008, issued by Parent on June 25, 1993, and (b) Parent may make
Distributions in the form of common stock.
(iv) FIXED CHARGE COVERAGE RATIO. Commencing April
30, 2005, the Company shall not permit the Fixed Charge Coverage Ratio, (a) to
be less than 1.0:1 as of the end of each April, July, October and January (each,
a "FISCAL QUARTER") ending prior to January 1, 2007, and (b) to be less than
1.05:1 as of the last day of each Fiscal Quarter ending thereafter. "FIXED
CHARGE COVERAGE RATIO" means for any period, the ratio of (i) EBITDA for such
period MINUS cash capital expenditures made (to the extent not already incurred
in a prior period) or incurred during such period, to (ii) the sum of (a)
interest expense, (b) principal payments required to be paid during such period
in respect of indebtedness, and (c) all federal, state, and local income taxes
accrued, all as determined for the twelve months ending on the determination
date for the Company and its subsidiaries on a consolidated basis without
duplication and in accordance with generally accepted accounting principles
consistently applied. "EBITDA" means, with respect to any fiscal period, the
Company's and its subsidiaries' consolidated net earnings (or loss), minus
extraordinary gains and interest income, plus interest expense, income taxes,
and depreciation and amortization for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(v) LEVERAGE RATIO. The Company shall not permit the
Leverage Ratio, as determined as of the end of each Fiscal Quarter, to be
greater than the amount set forth in the following table for the Fiscal Quarters
ending in the period set forth opposite thereto:
LEVERAGE RATIO Period
-------------- ------
4.50:1.0 04/30/05 - 10/30/05
4.30:1.0 10/31/05 - 10/30/06
4.00:1.0 10/31/06 - 10/30/07
3.80:1.0 10/31/07 - 10/30/08
"LEVERAGE RATIO" means, at any date of determination, the
ratio of (a) Total Debt at such date to (b) EBITDA for the applicable period
ending on such date. "TOTAL DEBT" means, as of any date of determination,
without duplication, the sum of (a) the outstanding aggregate amount of the
obligations for borrowed money, (b) the outstanding principal amount of capital
leases, (c) the outstanding principal amount of purchase money indebtedness, (d)
the outstanding principal amount of funded debt, and (e) the outstanding
principal amount of all obligations owing to GECC, DVI and USBPS; all as
5
determined for the Company and its subsidiaries on a consolidated basis without
duplication and in accordance with generally accepted accounting principles
consistently applied.
(vi) EBITDA MARGIN. The Company shall not permit the
EBITDA Margin to be less than 25% as of the end of any Fiscal Quarter ending on
or after April 30, 2005. "EBITDA MARGIN" means for any period, the ratio of (a)
EBITDA for such period, to (b) net revenues (excluding the professional service
fee component of radiology services) for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(vii) RECEIVABLE DAYS. The Company shall not permit
the Receivable Days to exceed 65 days as of the end of any Fiscal Quarter ending
on or after April 30, 2005. "RECEIVABLE DAYS" means for any period, a number
equal to (a) 365 divided by (b) the result of (i) net revenues for such period
divided by (ii) net receivables for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(viii) NAME CHANGES, ETC. The Company agrees that it
shall not change its name or jurisdiction of organization without giving 30 days
prior written notice to USBPS.
10. To induce USBPS on behalf of the Trustee to enter this
Agreement, the Guarantor hereby affirms and restates its Guarantee as related to
this Loan and AMENDED AND RESTATED RIDER A.
11. Radnet, the Company and the Guarantor each represent and
warrant that each has been represented by an attorney of its choice and is fully
aware of the terms contained in this Agreement and AMENDED AND RESTATED RIDER A
to which it is a party which was voluntarily entered into without coercion or
duress of any kind.
12. Radnet represents and warrants to USBPS on behalf of the
Noteholders and Trustee that all necessary actions on the part of Radnet to be
taken in connection with the execution, delivery and performance of this
Agreement have been taken; the performance by Radnet of this Agreement and the
6
AMENDED AND RESTATED RIDER A will not violate any of Radnet's Articles of
Incorporation, Articles of Formation, Partnership Agreement or other agreement
or law by which Radnet is bound.
13. Any notice, request, direction, consent, approval, waiver
or other communication required or permitted under this Agreement to be sent
must be in writing and will become effective only upon delivery to USBPS at the
address set forth herein as follows:
U.S. Bank Portfolio Services
0000 Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxx, XX 00000
Attn: Xxxx Xxx, Director of Operations
14. Except as provided herein, and in the AMENDED AND RESTATED
RIDER A, all of the other provisions of the Loan Documents not restated will
remain in effect.
15. This Agreement and the documents referenced herein
constitute the entire and final agreement among the parties with respect to the
subject matter hereof and there are no agreements, understandings, warranties or
representations among the parties with respect to these matters except as set
forth herein.
16. This Agreement will inure to the benefit of and bind the
parties and their respective successors and permitted assigns.
17. Neither this Agreement nor any of the provisions hereof
can be changed, waived, discharged or terminated except by an instrument in
writing signed by the parties against whom such enforcement of the change,
waiver, discharge or termination is sought.
18. This Agreement will be interpreted and construed under the
laws of the Commonwealth of Pennsylvania, regardless of the domicile of any
party and will be considered to have been made, executed and performed in
Pennsylvania.
7
19. THE UNDERSIGNED, AND SUBJECT TO THE PROVISIONS CONTAINED
HEREIN, USBPS FOR ITSELF AND AS AGENT FOR THE TRUSTEE, (A) AGREE TO SUBMIT FOR
THEMSELVES, IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT AND ANY
SCHEDULE OR FOR RECOGNITION AND ENFORCEMENT OF ANY JUDGMENT IN RESPECT HEREOF OR
THEREOF, TO THE EXCLUSIVE JURISDICTION OF THE COURTS OF THE COMONWEALTH OF
PENNSYLVANIA, THE COURTS OF THE UNITED STATES OF AMERICA FOR THE EASTERN
DISTRICT OF PENNSYLVANIA, AND APPELLATE COURTS FROM ANY THEREOF, (B) CONSENT
THAT ANY ACTION OR PROCEEDING SHALL BE BROUGHT IN SUCH COURTS, AND WAIVE ANY
OBJECTION THAT EACH MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH ACTION OR
PROCEEDING IN ANY SUCH COURT, (C) AGREE THAT SERVICE OF PROCESS OF ANY SUCH
ACTION OR PROCEEDING MAY BE EFFECTED BY CERTIFIED MAIL (OR ANY SUBSTANTIALLY
SIMILAR FORM OF MAIL), POSTAGE PREPAID, TO THE APPROPRIATE PARTY AT ITS ADDRESS
AS SET FORTH HEREIN, AND SERVICE MADE SHALL BE DEEMED TO BE COMPLETED UPON THE
EARLIER OF ACTUAL RECEIPT OR FIVE (5) DAYS AFTER THE SAME SHALL HAVE BEEN POSTED
AS AFORESAID, AND (D) AGREE THAT NOTHING HEREIN OR IN ANY EXHIBIT OR SCHEDULE
SHALL AFFECT THE RIGHT TO EFFECT SERVICE OF PROCESS IN ANY OTHER MANNER
PERMITTED BY LAW. USBPS AND THE UNDERSIGNED EACH HEREBY UNCONDITIONALLY WAIVES
ITS RIGHT TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING
OUT OF, DIRECTLY OR INDIRECTLY, THIS AGREEMENT, ANY EXHIBIT AND THE TRANSACTIONS
8
CONTEMPLATED HEREBY AND THEREBY, ANY OF THE RELATED DOCUMENTS, ANY DEALINGS
BETWEEN THE PARTIES HERETO RELATING TO THE SUBJECT MATTER HEREOF OR THEREOF,
AND/OR THE RELATIONSHIP THAT IS BEING ESTABLISHED BETWEEN USBPS AS AGENT FOR THE
TRUSTEE AND THE UNDERSIGNED, PROVIDED USBPS MAY IN ITS DISCRETION ENFORCE THE
TERMS OF THE FORUM SELECTION PROVISIONS IN THE LOANS.
20. Radnet, the Company and the Guarantor hereby release
USBPS, the Trustee, and the Noteholders from and against any claim, loss, or
damage arising out of the negotiation execution, and performance of the Loan or
related matters prior to the date hereof.
21. This Agreement may be executed in two or more counterparts
and each counterpart shall be deemed an original.
9
LYON FINANCIAL SERVICES, INC. DBA U.S. BANK
PORTFOLIO SERVICES, AS SUCCESSOR SERVICER
FOR DVI RECEIVABLES XVIII, L.L.C. AND AS
AGENT FOR U.S. BANK, N.A., AS TRUSTEE
By:_________________________________________
RADNET MANAGEMENT, INC.
By:_________________________________________
ACKNOWLEDGED AND AGREED TO:
Primedex Health Systems, Inc., Guarantor
By:_________________________________________
10
#3155-010
AMENDMENT TO LOAN DOCUMENTS
---------------------------
AGREEMENT made as of June 30, 2004 ("AMENDMENT AGREEMENT" or
"AGREEMENT") by and between LYON FINANCIAL SERVICES, INC. DBA U.S. BANK
PORTFOLIO SERVICES, as Successor Servicer for DVI Receivables XVI, L.L.C. and as
Agent for U.S. Bank, N.A., as Trustee, with offices at 0000 Xxxxxx Xxxxxx, Xxxxx
000, Xxxxxxxx, Xxxxxxxxx 00000 ("USBPS") and Radnet Management, Inc., a
corporation, with offices at 0000 Xxxxxx Xxxxxx, Xxx Xxxxxxx, XX 00000
("RADNET"), and such other signatories hereto.
WHEREAS, on or about July 11, 2001, Radnet executed and
delivered to DVI Financial Services Inc. ("DVI") a Master Loan Agreement
collectively with the Secured Promissory Note Number #3155-010 dated August 15,
2001 (the "LOAN");
WHEREAS, to secure the payment of the Loan and all other
obligations of Radnet to DVI (collectively the "OBLIGATIONS"), Radnet, pursuant
to a Master Security Agreement dated on or about July 11, 2001 (the "SECURITY
AGREEMENT"), granted DVI a first priority security interest in certain
Collateral described therein;
WHEREAS, to further secure payment of the Note and all other
Obligations of Radnet to DVI, Radnet delivered to DVI the guarantee (the
"GUARANTEE") of Primedex Health Systems, Inc. (the "GUARANTOR") (the "GUARANTEE"
together with the Loan and ancillary documents are, collectively the "LOAN
DOCUMENTS");
WHEREAS, substantially contemporaneously therewith, DVI
contributed all of the Loan Documents to DVI Receivables XVI, L.L.C. ("DVI XVI")
and thereafter pursuant to an Amended and Restated Indenture, DVI XVI granted a
first priority security interest in and pledged all of the Loan Documents in
favor of U.S. Bank, N.A., as Trustee, for the benefit of a
#3155-010
noteholder which purchased asset backed promissory notes issued by DVI XVI (the
"Noteholder");
WHEREAS, DVI contributed other Loans with Radnet or certain
affiliates of Radnet to this and other DVI securitizations (collectively the
"RELATED LOANS");
WHEREAS, Radnet is in default under the terms of the Loan;
WHEREAS, Radnet has requested USBPS to modify the Loan to
reflect an adjustment in payments;
WHEREAS, Radnet and/or certain of its affiliates have agreed
to modify the Related Loans;
WHEREAS, Radnet and certain of its affiliates are engaged in
negotiations to restructure or modify certain loan agreements, loans and
promissory notes with each of General Electric Capital Corporation ("GECC") and
DVI (with respect to GECC, the "GECC MODIFICATION", and with respect to DVI, the
"DVI MODIFICATION");
WHEREAS, subject to the following terms and conditions, USBPS
is willing to modify the Loan as hereinafter provided.
NOW, THEREFORE, the parties agree as follows:
1. All of the Whereas clauses are incorporated herein as if
hereinafter set forth at full length.
2. Radnet acknowledges that it is duly indebted to the Trustee
in the sum set forth on AMENDED AND RESTATED RIDER A annexed hereto, and has no
defenses, counterclaims or offsets to such indebtedness.
3. USBPS as Agent for the Trustee will modify the Loan to
provide for payments to commence in accordance with the attached revised payment
schedule (the
2
#3155-010
"AMENDED AND RESTATED RIDER A"). Radnet may, at any time, prepay all of the then
outstanding Obligations subject to an additional prepayment fee of 2% of such
Obligations. Partial prepayments of the Obligations shall not be permitted at
any time.
4. This Agreement shall become effective upon the date that
USBPS receives this Agreement duly executed by Radnet and the satisfaction of
each of the following conditions:
(a) Radnet and/or its affiliates shall have entered
into agreements on similar terms to this Agreement and
otherwise in form and substance satisfactory to USBPS,
relating to the Related Loans (the "Related Loan
Modifications");
(b) reimbursement of USBPS's legal fees incurred in
connection with the execution of this Agreement and the
Related Loan Modifications, aggregating $50,000, shall have
been received by USBPS;
(c) Radnet and/or its affiliates shall have entered
into the GECC Modification and the DVI Modification.
5. The closing of the restructuring of the Radnet Loan is
further subject to delivery to USBPS of all of the following, each in form and
substance satisfactory to USBPS and its counsel:
(a) The executed AMENDED AND RESTATED RIDER A;
(b) An executed copy of this Agreement;
(c) Such other documents, including UCC financing
statements as USBPS reasonably requests.
6. Radnet hereby acknowledges and agrees that it has no, and
will not assert any, defenses, counterclaims or offsets to the Loan and AMENDED
AND RESTATED RIDER A and acknowledges and agrees that the Trustee holds a
first-priority security interest in the Collateral.
7. Any default or other breach of any obligation under the
GECC Modification, the DVI Modification, or any of the Related Loan
Modifications shall constitute a
3
#3155-010
default under the Loan as modified by this Agreement, and USBPS shall have all
remedies thereunder.
8. Radnet hereby releases the Noteholder, USBPS individually
and as agent for the Trustee and the special purpose entities for which the
Trustee holds collateral, from and against any claims, loss or damage of any
kind or nature arising out of the Loan.
9. So long as any of the Obligations remain outstanding,
Radnet Management, Inc. (the "COMPANY") agrees as follows:
(i) FINANCIAL REPORTING. The Company shall furnish
the following documents or information to USBPS:
(A) Within 30 days after the end of each
Fiscal Quarter (as defined below) (i) (or 90 days in respect of the last month
of the fiscal year), the Company's consolidated, consolidating and on a center
by center basis, financial statements, including the most recent annual report,
balance sheet (not on a center by center basis) and income statement, prepared
in accordance with generally accepted accounting principles, which reports, the
Company warrants, shall fully and fairly represent the true financial condition
of the Company and (ii) updated projections for the Company and for each center;
(B) any other financial information normally
provided by the Company to the public; and
(C) Such other financial data or information
relative to this Amendment Agreement, including, without limitation, listings of
serial numbers or other identification data and confirmations of such
information, as USBPS may time-to-time reasonably request.
(ii) NO AMENDMENTS. Subsequent to the date of this
Amendment Agreement, the Company will not agree or consent to any amendments or
modifications to any agreement between the Company and DVI, GECC or Xxxxx Fargo
Foothill, Inc. ("FOOTHILL") containing terms (including, but not limited to,
increasing interest rates, accelerating the principal amortization or maturity,
new or more stringent defaults, additional collateral, and new remedies
provisions) that would be more onerous to the Company, or adversely impact or
affect GECC with respect to the terms of this Amendment Agreement.
(iii) DISTRIBUTIONS. The Company shall not make any
distribution or declare or pay any dividends (in cash or other property, other
than common stock) on, or purchase, acquire, redeem, or retire any of the
Company's stock, of any class, whether now or hereafter outstanding
(collectively, "DISTRIBUTIONS"); PROVIDED, HOWEVER, that so long as no
4
#3155-010
default shall have occurred and be continuing immediately prior to or after
giving effect to any such payment, (a) the Company may make Distributions to
Primedex Health Systems, Inc., a New York corporation (the "PARENT") (1) in
amounts necessary to pay customary expenses of Parent in the ordinary course of
its business as a public holding company (including salaries and related
reasonable and customary expenses incurred by employees of Parent) in an
aggregate amount not to exceed $750,000 in any fiscal year, (2) in amounts
necessary to enable Parent to pay taxes when due and owing by it in the ordinary
course of its business as a holding company and (3) in amounts necessary to
enable Parent to pay interest on those certain 11.5% Series A Convertible
Subordinated Notes due June 30, 2008, issued by Parent on June 25, 1993, and (b)
Parent may make Distributions in the form of common stock.
(iv) FIXED CHARGE COVERAGE RATIO. Commencing April
30, 2005, the Company shall not permit the Fixed Charge Coverage Ratio, (a) to
be less than 1.0:1 as of the end of each April, July, October and January (each,
a "FISCAL QUARTER") ending prior to January 1, 2007, and (b) to be less than
1.05:1 as of the last day of each Fiscal Quarter ending thereafter. "FIXED
CHARGE COVERAGE RATIO" means for any period, the ratio of (i) EBITDA for such
period minus cash capital expenditures made (to the extent not already incurred
in a prior period) or incurred during such period, to (ii) the sum of (a)
interest expense, (b) principal payments required to be paid during such period
in respect of indebtedness, and (c) all federal, state, and local income taxes
accrued, all as determined for the twelve months ending on the determination
date for the Company and its subsidiaries on a consolidated basis without
duplication and in accordance with generally accepted accounting principles
consistently applied. "EBITDA" means, with respect to any fiscal period, the
Company's and its subsidiaries' consolidated net earnings (or loss), minus
extraordinary gains and interest income, plus interest expense, income taxes,
and depreciation and amortization for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(v) LEVERAGE RATIO. The Company shall not permit the
Leverage Ratio, as determined as of the end of each Fiscal Quarter, to be
greater than the amount set forth in the following table for the Fiscal Quarters
ending in the period set forth opposite thereto:
LEVERAGE RATIO PERIOD
-------------- ------
4.50:1.0 04/30/05 - 10/30/05
4.30:1.0 10/31/05 - 10/30/06
4.00:1.0 10/31/06 - 10/30/07
3.80:1.0 10/31/07 - 10/30/08
"LEVERAGE RATIO" means, at any date of determination, the
ratio of (a) Total Debt at such date to (b) EBITDA for the applicable period
ending on such date. "TOTAL DEBT" means, as of any date of determination,
without duplication, the sum of (a) the outstanding aggregate amount of the
obligations for borrowed money, (b) the outstanding principal amount of capital
leases, (c) the outstanding principal amount of purchase money indebtedness, (d)
the outstanding principal amount of funded debt, and (e) the outstanding
principal amount of all obligations
5
#3155-010
owing to GECC, DVI and USBPS; all as determined for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(vi) EBITDA MARGIN. The Company shall not permit the
EBITDA Margin to be less than 25% as of the end of any Fiscal Quarter ending on
or after April 30, 2005. "EBITDA MARGIN" means for any period, the ratio of (a)
EBITDA for such period, to (b) net revenues (excluding the professional service
fee component of radiology services) for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(vii) RECEIVABLE DAYS. The Company shall not permit
the Receivable Days to exceed 65 days as of the end of any Fiscal Quarter ending
on or after April 30, 2005. "RECEIVABLE DAYS" means for any period, a number
equal to (a) 365 divided by (b) the result of (i) net revenues for such period
divided by (ii) net receivables for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(viii) NAME CHANGES, ETC. The Company agrees that it
shall not change its name or jurisdiction of organization without giving 30 days
prior written notice to USBPS.
10. To induce USBPS on behalf of the Trustee to enter this
Agreement, the Guarantor hereby affirms and restates its Guarantee as related to
this Loan and AMENDED AND RESTATED RIDER A.
11. Radnet, the Company and the Guarantor each represent and
warrant that each has been represented by an attorney of its choice and is fully
aware of the terms contained in this Agreement and AMENDED AND RESTATED RIDER A
to which it is a party which was voluntarily entered into without coercion or
duress of any kind.
12. Radnet represents and warrants to USBPS on behalf of the
Noteholders and Trustee that all necessary actions on the part of Radnet to be
taken in connection with the execution, delivery and performance of this
Agreement have been taken; the performance by Radnet of this Agreement and the
AMENDED AND RESTATED RIDER A will not violate any of
6
#3155-010
Radnet's Articles of Incorporation, Articles of Formation, Partnership Agreement
or other agreement or law by which Radnet is bound.
13. Any notice, request, direction, consent, approval, waiver
or other communication required or permitted under this Agreement to be sent
must be in writing and will become effective only upon delivery to USBPS at the
address set forth herein as follows:
U.S. Bank Portfolio Services
0000 Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxx, XX 00000
Attn: Xxxx Xxx, Director of Operations
14. Except as provided herein, and in the AMENDED AND RESTATED
RIDER A, all of the other provisions of the Loan Documents not restated will
remain in effect.
15. This Agreement and the documents referenced herein
constitute the entire and final agreement among the parties with respect to the
subject matter hereof and there are no agreements, understandings, warranties or
representations among the parties with respect to these matters except as set
forth herein.
16. This Agreement will inure to the benefit of and bind the
parties and their respective successors and permitted assigns.
17. Neither this Agreement nor any of the provisions hereof
can be changed, waived, discharged or terminated except by an instrument in
writing signed by the parties against whom such enforcement of the change,
waiver, discharge or termination is sought.
18. This Agreement will be interpreted and construed under the
laws of the Commonwealth of Pennsylvania, regardless of the domicile of any
party and will be considered to have been made, executed and performed in
Pennsylvania.
7
#3155-010
19. THE UNDERSIGNED, AND SUBJECT TO THE PROVISIONS CONTAINED
HEREIN, USBPS FOR ITSELF AND AS AGENT FOR THE TRUSTEE, (A) AGREE TO SUBMIT FOR
THEMSELVES, IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT AND ANY
SCHEDULE OR FOR RECOGNITION AND ENFORCEMENT OF ANY JUDGMENT IN RESPECT HEREOF OR
THEREOF, TO THE EXCLUSIVE JURISDICTION OF THE COURTS OF THE COMONWEALTH OF
PENNSYLVANIA, THE COURTS OF THE UNITED STATES OF AMERICA FOR THE EASTERN
DISTRICT OF PENNSYLVANIA, AND APPELLATE COURTS FROM ANY THEREOF, (B) CONSENT
THAT ANY ACTION OR PROCEEDING SHALL BE BROUGHT IN SUCH COURTS, AND WAIVE ANY
OBJECTION THAT EACH MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH ACTION OR
PROCEEDING IN ANY SUCH COURT, (C) AGREE THAT SERVICE OF PROCESS OF ANY SUCH
ACTION OR PROCEEDING MAY BE EFFECTED BY CERTIFIED MAIL (OR ANY SUBSTANTIALLY
SIMILAR FORM OF MAIL), POSTAGE PREPAID, TO THE APPROPRIATE PARTY AT ITS ADDRESS
AS SET FORTH HEREIN, AND SERVICE MADE SHALL BE DEEMED TO BE COMPLETED UPON THE
EARLIER OF ACTUAL RECEIPT OR FIVE (5) DAYS AFTER THE SAME SHALL HAVE BEEN POSTED
AS AFORESAID, AND (D) AGREE THAT NOTHING HEREIN OR IN ANY EXHIBIT OR SCHEDULE
SHALL AFFECT THE RIGHT TO EFFECT SERVICE OF PROCESS IN ANY OTHER MANNER
PERMITTED BY LAW. USBPS AND THE UNDERSIGNED EACH HEREBY UNCONDITIONALLY WAIVES
ITS RIGHT TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING
OUT OF, DIRECTLY OR INDIRECTLY, THIS AGREEMENT, ANY EXHIBIT AND THE TRANSACTIONS
8
#3155-010
CONTEMPLATED HEREBY AND THEREBY, ANY OF THE RELATED DOCUMENTS, ANY DEALINGS
BETWEEN THE PARTIES HERETO RELATING TO THE SUBJECT MATTER HEREOF OR THEREOF,
AND/OR THE RELATIONSHIP THAT IS BEING ESTABLISHED BETWEEN USBPS AS AGENT FOR THE
TRUSTEE AND THE UNDERSIGNED, PROVIDED USBPS MAY IN ITS DISCRETION ENFORCE THE
TERMS OF THE FORUM SELECTION PROVISIONS IN THE LOANS.
20. Radnet, the Companyand the Guarantor hereby release USBPS,
the Trustee, and the Noteholders from and against any claim, loss, or damage
arising out of the negotiation execution, and performance of the Loan or related
matters prior to the date hereof.
21.This Agreement may be executed in two or more counterparts
and each counterpart shall be deemed an original.
9
#3155-010
LYON FINANCIAL SERVICES, INC. DBA U.S.
BANK PORTFOLIO SERVICES, AS SUCCESSOR
SERVICER FOR DVI RECEIVABLES XVI, L.L.C.
AND AS AGENT FOR U.S. BANK, N.A., AS TRUSTEE
By:_________________________________________
RADNET MANAGEMENT, INC.
By:_________________________________________
ACKNOWLEDGED AND AGREED TO:
Primedex Health Systems, Inc., Guarantor
By:_____________________________________
10
#3155-009
AMENDMENT TO LOAN DOCUMENTS
---------------------------
AGREEMENT made as of June 30, 2004 ("AMENDMENT AGREEMENT" or
"AGREEMENT") by and between LYON FINANCIAL SERVICES, INC. DBA U.S. BANK
PORTFOLIO SERVICES, as Sub-Servicer for DVI Funding, L.L.C. and as Agent for
U.S. Bank, N.A., as Collateral Agent, with offices at 0000 Xxxxxx Xxxxxx, Xxxxx
000, Xxxxxxxx, Xxxxxxxxx 00000 ("USBPS") and Radnet Management, Inc., a
corporation, with offices at 0000 Xxxxxx Xxxxxx, Xxx Xxxxxxx, XX 00000
("RADNET"), and such other signatories hereto.
WHEREAS, on or about July 11, 2001, Radnet executed and
delivered to DVI Financial Services Inc. ("DVI") a Master Loan Agreement
collectively with the Secured Promissory Note Number #3155-009 dated August 15,
2001 (the "LOAN");
WHEREAS, to secure the payment of the Loan and all other
obligations of Radnet to DVI (collectively the "OBLIGATIONS"), Radnet, pursuant
to a Master Security Agreement dated on or about July 11, 2001 (the "SECURITY
AGREEMENT"), granted DVI a first priority security interest in certain
Collateral described therein;
WHEREAS, to further secure payment of the Note and all other
Obligations of Radnet to DVI, Radnet delivered to DVI the guarantee (the
"GUARANTEE") of Primedex Health Systems, Inc. (the "GUARANTOR") (the "GUARANTEE"
together with the Loan and ancillary documents are, collectively the "LOAN
DOCUMENTS");
WHEREAS, substantially contemporaneously therewith, DVI
contributed all of the Loan Documents to DVI Funding, L.L.C. ("DVI FUNDING") and
thereafter pursuant to an Amended and Restated Indenture, DVI Funding granted a
first priority security interest in and pledged all of the Loan Documents in
favor of U.S. Bank, N.A., as Collateral Agent, for the
#3155-009
benefit of a noteholder which purchased asset backed promissory notes issued by
DVI Funding (the "Noteholder");
WHEREAS, DVI contributed other Loans with Radnet or certain
affiliates of Radnet to this and other DVI securitizations (collectively the
"RELATED LOANS");
WHEREAS, Radnet is in default under the terms of the Loan;
WHEREAS, Radnet has requested USBPS to modify the Loan to
reflect an adjustment in payments;
WHEREAS, Radnet and/or certain of its affiliates have agreed
to modify the Related Loans;
WHEREAS, Radnet and certain of its affiliates are engaged in
negotiations to restructure or modify certain loan agreements, loans and
promissory notes with each of General Electric Capital Corporation ("GECC") and
DVI (with respect to GECC, the "GECC MODIFICATION", and with respect to DVI, the
"DVI MODIFICATION");
WHEREAS, subject to the following terms and conditions, USBPS
is willing to modify the Loan as hereinafter provided.
NOW, THEREFORE, the parties agree as follows:
1. All of the Whereas clauses are incorporated herein as if
hereinafter set forth at full length.
2. Radnet acknowledges that it is duly indebted to the
Collateral Agent in the sum set forth on AMENDED AND RESTATED RIDER A annexed
hereto, and has no defenses, counterclaims or offsets to such indebtedness.
3. USBPS as Agent for the Collateral Agent will modify the
Loan to provide for payments to commence in accordance with the attached revised
payment schedule (the
2
#3155-009
"AMENDED AND RESTATED RIDER A"). Radnet may, at any time, prepay all of the then
outstanding Obligations subject to an additional prepayment fee of 2% of such
Obligations. Partial prepayments of the Obligations shall not be permitted at
any time.
4. This Agreement shall become effective upon the date that
USBPS receives this Agreement duly executed by Radnet and the satisfaction of
each of the following conditions:
(a) Radnet and/or its affiliates shall have entered
into agreements on similar terms to this Agreement and
otherwise in form and substance satisfactory to USBPS,
relating to the Related Loans (the "Related Loan
Modifications");
(b) reimbursement of USBPS's legal fees incurred in
connection with the execution of this Agreement and the
Related Loan Modifications, aggregating $50,000, shall have
been received by USBPS;
(c) Radnet and/or its affiliates shall have entered
into the GECC Modification and the DVI Modification.
5. The closing of the restructuring of the Radnet Loan is
further subject to delivery to USBPS of all of the following, each in form and
substance satisfactory to USBPS and its counsel:
(a) The executed AMENDED AND RESTATED RIDER A;
(b) An executed copy of this Agreement;
(c) Such other documents, including UCC financing
statements as USBPS reasonably requests.
6. Radnet hereby acknowledges and agrees that it has no, and
will not assert any, defenses, counterclaims or offsets to the Loan and AMENDED
AND RESTATED RIDER A and acknowledges and agrees that the Collateral Agent holds
a first-priority security interest in the Collateral.
3
7. Any default or other breach of any obligation under the
GECC Modification, the DVI Modification, or any of the Related Loan
Modifications shall constitute a default under the Loan as modified by this
Agreement, and USBPS shall have all remedies thereunder.
8. Radnet hereby releases the Noteholder, USBPS individually
and as agent for the Collateral Agent and the special purpose entities for which
the Collateral Agent holds collateral, from and against any claims, loss or
damage of any kind or nature arising out of the Loan.
9. So long as any of the Obligations remain outstanding,
Radnet Management, Inc. (the "COMPANY") agrees as follows:
(i) FINANCIAL REPORTING. The Company shall furnish
the following documents or information to USBPS:
(A) Within 30 days after the end of each
Fiscal Quarter (as defined below) (i) (or 90 days in respect of the last month
of the fiscal year), the Company's consolidated, consolidating and on a center
by center basis, financial statements, including the most recent annual report,
balance sheet (not on a center by center basis) and income statement, prepared
in accordance with generally accepted accounting principles, which reports, the
Company warrants, shall fully and fairly represent the true financial condition
of the Company and (ii) updated projections for the Company and for each center;
(B) any other financial information normally
provided by the Company to the public; and
(C) Such other financial data or information
relative to this Amendment Agreement, including, without limitation, listings of
serial numbers or other identification data and confirmations of such
information, as USBPS may time-to-time reasonably request.
(ii) NO AMENDMENTS. Subsequent to the date of this
Amendment Agreement, the Company will not agree or consent to any amendments or
modifications to any agreement between the Company and DVI, GECC or Xxxxx Fargo
Foothill, Inc. ("FOOTHILL") containing terms (including, but not limited to,
increasing interest rates, accelerating the principal amortization or maturity,
new or more stringent defaults, additional collateral, and new
4
#3155-009
remedies provisions) that would be more onerous to the Company, or adversely
impact or affect GECC with respect to the terms of this Amendment Agreement.
(iii) DISTRIBUTIONS. The Company shall not make any
distribution or declare or pay any dividends (in cash or other property, other
than common stock) on, or purchase, acquire, redeem, or retire any of the
Company's stock, of any class, whether now or hereafter outstanding
(collectively, "DISTRIBUTIONS"); PROVIDED, HOWEVER, that so long as no default
shall have occurred and be continuing immediately prior to or after giving
effect to any such payment, (a) the Company may make Distributions to Primedex
Health Systems, Inc., a New York corporation (the "PARENT") (1) in amounts
necessary to pay customary expenses of Parent in the ordinary course of its
business as a public holding company (including salaries and related reasonable
and customary expenses incurred by employees of Parent) in an aggregate amount
not to exceed $750,000 in any fiscal year, (2) in amounts necessary to enable
Parent to pay taxes when due and owing by it in the ordinary course of its
business as a holding company and (3) in amounts necessary to enable Parent to
pay interest on those certain 11.5% Series A Convertible Subordinated Notes due
June 30, 2008, issued by Parent on June 25, 1993, and (b) Parent may make
Distributions in the form of common stock.
(iv) FIXED CHARGE COVERAGE RATIO. Commencing April
30, 2005, the Company shall not permit the Fixed Charge Coverage Ratio, (a) to
be less than 1.0:1 as of the end of each April, July, October and January (each,
a "FISCAL QUARTER") ending prior to January 1, 2007, and (b) to be less than
1.05:1 as of the last day of each Fiscal Quarter ending thereafter. "FIXED
CHARGE COVERAGE RATIO" means for any period, the ratio of (i) EBITDA for such
period minus cash capital expenditures made (to the extent not already incurred
in a prior period) or incurred during such period, to (ii) the sum of (a)
interest expense, (b) principal payments required to be paid during such period
in respect of indebtedness, and (c) all federal, state, and local income taxes
accrued, all as determined for the twelve months ending on the determination
date for the Company and its subsidiaries on a consolidated basis without
duplication and in accordance with generally accepted accounting principles
consistently applied. "EBITDA" means, with respect to any fiscal period, the
Company's and its subsidiaries' consolidated net earnings (or loss), minus
extraordinary gains and interest income, plus interest expense, income taxes,
and depreciation and amortization for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(v) LEVERAGE RATIO. The Company shall not permit the
Leverage Ratio, as determined as of the end of each Fiscal Quarter, to be
greater than the amount set forth in the following table for the Fiscal Quarters
ending in the period set forth opposite thereto:
LEVERAGE RATIO PERIOD
-------------- ------
4.50:1.0 04/30/05 - 10/30/05
4.30:1.0 10/31/05 - 10/30/06
4.00:1.0 10/31/06 - 10/30/07
3.80:1.0 10/31/07 - 10/30/08
5
#3155-009
"LEVERAGE RATIO" means, at any date of determination, the
ratio of (a) Total Debt at such date to (b) EBITDA for the applicable period
ending on such date. "TOTAL DEBT" means, as of any date of determination,
without duplication, the sum of (a) the outstanding aggregate amount of the
obligations for borrowed money, (b) the outstanding principal amount of capital
leases, (c) the outstanding principal amount of purchase money indebtedness, (d)
the outstanding principal amount of funded debt, and (e) the outstanding
principal amount of all obligations owing to GECC, DVI and USBPS; all as
determined for the Company and its subsidiaries on a consolidated basis without
duplication and in accordance with generally accepted accounting principles
consistently applied.
(vi) EBITDA MARGIN. The Company shall not permit the
EBITDA Margin to be less than 25% as of the end of any Fiscal Quarter ending on
or after April 30, 2005. "EBITDA MARGIN" means for any period, the ratio of (a)
EBITDA for such period, to (b) net revenues (excluding the professional service
fee component of radiology services) for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(vii) RECEIVABLE DAYS. The Company shall not permit
the Receivable Days to exceed 65 days as of the end of any Fiscal Quarter ending
on or after April 30, 2005. "RECEIVABLE DAYS" means for any period, a number
equal to (a) 365 divided by (b) the result of (i) net revenues for such period
divided by (ii) net receivables for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(viii) NAME CHANGES, ETC. The Company agrees that it
shall not change its name or jurisdiction of organization without giving 30 days
prior written notice to USBPS.
10. To induce USBPS on behalf of the Collateral Agent to enter
this Agreement, the Guarantor hereby affirms and restates its Guarantee as
related to this Loan and AMENDED AND RESTATED RIDER A.
11. Radnet, the Company and the Guarantor each represent and
warrant that each has been represented by an attorney of its choice and is fully
aware of the terms contained in this Agreement and AMENDED AND RESTATED RIDER A
to which it is a party which was voluntarily entered into without coercion or
duress of any kind.
12. Radnet represents and warrants to USBPS on behalf of the
Noteholders and Collateral Agent that all necessary actions on the part of
Radnet to be taken in connection
6
#3155-009
with the execution, delivery and performance of this Agreement have been taken;
the performance by Radnet of this Agreement and the AMENDED AND RESTATED RIDER A
will not violate any of Radnet's Articles of Incorporation, Articles of
Formation, Partnership Agreement or other agreement or law by which Radnet is
bound.
13. Any notice, request, direction, consent, approval, waiver
or other communication required or permitted under this Agreement to be sent
must be in writing and will become effective only upon delivery to USBPS at the
address set forth herein as follows:
U.S. Bank Portfolio Services
0000 Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxx, XX 00000
Attn: Xxxx Xxx, Director of Operations
14. Except as provided herein, and in the AMENDED AND RESTATED
RIDER A, all of the other provisions of the Loan Documents not restated will
remain in effect.
15. This Agreement and the documents referenced herein
constitute the entire and final agreement among the parties with respect to the
subject matter hereof and there are no agreements, understandings, warranties or
representations among the parties with respect to these matters except as set
forth herein.
16. This Agreement will inure to the benefit of and bind the
parties and their respective successors and permitted assigns.
17. Neither this Agreement nor any of the provisions hereof
can be changed, waived, discharged or terminated except by an instrument in
writing signed by the parties against whom such enforcement of the change,
waiver, discharge or termination is sought.
7
18. This Agreement will be interpreted and construed under the
laws of the Commonwealth of Pennsylvania, regardless of the domicile of any
party and will be considered to have been made, executed and performed in
Pennsylvania.
19. THE UNDERSIGNED, AND SUBJECT TO THE PROVISIONS CONTAINED
HEREIN, USBPS FOR ITSELF AND AS AGENT FOR THE COLLATERAL AGENT, (A) AGREE TO
SUBMIT FOR THEMSELVES, IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS
AGREEMENT AND ANY SCHEDULE OR FOR RECOGNITION AND ENFORCEMENT OF ANY JUDGMENT IN
RESPECT HEREOF OR THEREOF, TO THE EXCLUSIVE JURISDICTION OF THE COURTS OF THE
COMONWEALTH OF PENNSYLVANIA, THE COURTS OF THE UNITED STATES OF AMERICA FOR THE
EASTERN DISTRICT OF PENNSYLVANIA, AND APPELLATE COURTS FROM ANY THEREOF, (B)
CONSENT THAT ANY ACTION OR PROCEEDING SHALL BE BROUGHT IN SUCH COURTS, AND WAIVE
ANY OBJECTION THAT EACH MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH
ACTION OR PROCEEDING IN ANY SUCH COURT, (C) AGREE THAT SERVICE OF PROCESS OF ANY
SUCH ACTION OR PROCEEDING MAY BE EFFECTED BY CERTIFIED MAIL (OR ANY
SUBSTANTIALLY SIMILAR FORM OF MAIL), POSTAGE PREPAID, TO THE APPROPRIATE PARTY
AT ITS ADDRESS AS SET FORTH HEREIN, AND SERVICE MADE SHALL BE DEEMED TO BE
COMPLETED UPON THE EARLIER OF ACTUAL RECEIPT OR FIVE (5) DAYS AFTER THE SAME
SHALL HAVE BEEN POSTED AS AFORESAID, AND (D) AGREE THAT NOTHING HEREIN OR IN ANY
EXHIBIT OR SCHEDULE SHALL AFFECT THE RIGHT TO EFFECT SERVICE OF PROCESS IN ANY
OTHER MANNER PERMITTED BY LAW. USBPS AND THE UNDERSIGNED EACH
8
#3155-009
HEREBY UNCONDITIONALLY WAIVES ITS RIGHT TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF
ACTION BASED UPON OR ARISING OUT OF, DIRECTLY OR INDIRECTLY, THIS AGREEMENT, ANY
EXHIBIT AND THE TRANSACTIONS CONTEMPLATED HEREBY AND THEREBY, ANY OF THE RELATED
DOCUMENTS, ANY DEALINGS BETWEEN THE PARTIES HERETO RELATING TO THE SUBJECT
MATTER HEREOF OR THEREOF, AND/OR THE RELATIONSHIP THAT IS BEING ESTABLISHED
BETWEEN USBPS AS AGENT FOR THE TRUSTEE AND THE UNDERSIGNED, PROVIDED USBPS MAY
IN ITS DISCRETION ENFORCE THE TERMS OF THE FORUM SELECTION PROVISIONS IN THE
LOANS.
20. Radnet, the Company and the Guarantor hereby release
USBPS, the Collateral Agent, and the Noteholders from and against any claim,
loss, or damage arising out of the negotiation execution, and performance of the
Loan or related matters prior to the date hereof.
21. This Agreement may be executed in two or more counterparts
and each counterpart shall be deemed an original.
9
#3155-009
LYON FINANCIAL SERVICES, INC. DBA U.S.
BANK PORTFOLIO SERVICES, AS SUB-SERVICER
FOR DVI FUNDING, L.L.C. AND AS AGENT
FOR U.S. BANK, N.A., AS COLLATERAL AGENT
By:_________________________________________
RADNET MANAGEMENT, INC.
By:_________________________________________
ACKNOWLEDGED AND AGREED TO:
Primedex Health Systems, Inc., Guarantor
By:_____________________________________
10
#3155-008
AMENDMENT TO LOAN DOCUMENTS
---------------------------
AGREEMENT made as of June 30, 2004 ("AMENDMENT AGREEMENT" or
"AGREEMENT") by and between LYON FINANCIAL SERVICES, INC. DBA U.S. BANK
PORTFOLIO SERVICES, as Successor Servicer for DVI Receivables XI, L.L.C. and as
Agent for U.S. Bank, N.A., as Trustee, with offices at 0000 Xxxxxx Xxxxxx, Xxxxx
000, Xxxxxxxx, Xxxxxxxxx 00000 ("USBPS") and Radnet Management, Inc., a
corporation, with offices at 0000 Xxxxxx Xxxxxx, Xxx Xxxxxxx, XX 00000
("RADNET"), and such other signatories hereto.
WHEREAS, on or about July 11, 2001, Radnet executed and
delivered to DVI Financial Services Inc. ("DVI") a Master Loan Agreement
collectively with the Secured Promissory Note Number #3155-008 dated August 15,
2001 (the "LOAN");
WHEREAS, to secure the payment of the Loan and all other
obligations of Radnet to DVI (collectively the "OBLIGATIONS"), Radnet, pursuant
to a Master Security Agreement dated on or about July 11, 2001 (the "SECURITY
AGREEMENT"), granted DVI a first priority security interest in certain
Collateral described therein;
WHEREAS, to further secure payment of the Note and all other
Obligations of Radnet to DVI, Radnet delivered to DVI the guarantee (the
"GUARANTEE") of Primedex Health Systems, Inc. (the "GUARANTOR") (the "GUARANTEE"
together with the Loan and ancillary documents are, collectively the "LOAN
DOCUMENTS");
WHEREAS, substantially contemporaneously therewith, DVI
contributed all of the Loan Documents to DVI Receivables XI, L.L.C. ("DVI XI")
and thereafter pursuant to an Amended and Restated Indenture, DVI XI granted a
first priority security interest in and pledged all of the Loan Documents in
favor of U.S. Bank, N.A., as Trustee, for the benefit of a
#3155-008
noteholder which purchased asset backed promissory notes issued by DVI XI (the
"Noteholder");
WHEREAS, DVI contributed other Loans with Radnet or certain
affiliates of Radnet to this and other DVI securitizations (collectively the
"RELATED LOANS");
WHEREAS, Radnet is in default under the terms of the Loan;
WHEREAS, Radnet has requested USBPS to modify the Loan to
reflect an adjustment in payments;
WHEREAS, Radnet and/or certain of its affiliates have agreed
to modify the Related Loans;
WHEREAS, Radnet and certain of its affiliates are engaged in
negotiations to restructure or modify certain loan agreements, loans and
promissory notes with each of General Electric Capital Corporation ("GECC") and
DVI (with respect to GECC, the "GECC MODIFICATION", and with respect to DVI, the
"DVI MODIFICATION");
WHEREAS, subject to the following terms and conditions, USBPS
is willing to modify the Loan as hereinafter provided.
NOW, THEREFORE, the parties agree as follows:
1. All of the Whereas clauses are incorporated herein as if
hereinafter set forth at full length.
2. Radnet acknowledges that it is duly indebted to the Trustee
in the sum set forth on AMENDED AND RESTATED RIDER A annexed hereto, and has no
defenses, counterclaims or offsets to such indebtedness.
3. USBPS as Agent for the Trustee will modify the Loan to
provide for payments to commence in accordance with the attached revised payment
schedule (the
2
#3155-008
"AMENDED AND RESTATED RIDER A"). Radnet may, at any time, prepay all of the then
outstanding Obligations subject to an additional prepayment fee of 2% of such
Obligations. Partial prepayments of the Obligations shall not be permitted at
any time.
4. This Agreement shall become effective upon the date that
USBPS receives this Agreement duly executed by Radnet and the satisfaction of
each of the following conditions:
(a) Radnet and/or its affiliates shall have entered
into agreements on similar terms to this Agreement and
otherwise in form and substance satisfactory to USBPS,
relating to the Related Loans (the "Related Loan
Modifications");
(b) reimbursement of USBPS's legal fees incurred in
connection with the execution of this Agreement and the
Related Loan Modifications, aggregating $50,000, shall have
been received by USBPS;
(c) Radnet and/or its affiliates shall have entered
into the GECC Modification and the DVI Modification.
5. The closing of the restructuring of the Radnet Loan is
further subject to delivery to USBPS of all of the following, each in form and
substance satisfactory to USBPS and its counsel:
(a) The executed AMENDED AND RESTATED RIDER A;
(b) An executed copy of this Agreement;
(c) Such other documents, including UCC financing
statements as USBPS reasonably requests.
6. Radnet hereby acknowledges and agrees that it has no, and
will not assert any, defenses, counterclaims or offsets to the Loan and AMENDED
AND RESTATED RIDER A and acknowledges and agrees that the Trustee holds a
first-priority security interest in the Collateral.
7. Any default or other breach of any obligation under the
GECC Modification, the DVI Modification, or any of the Related Loan
Modifications shall constitute a
3
#3155-008
default under the Loan as modified by this Agreement, and USBPS shall have all
remedies thereunder.
8. Radnet hereby releases the Noteholder, USBPS individually
and as agent for the Trustee and the special purpose entities for which the
Trustee holds collateral, from and against any claims, loss or damage of any
kind or nature arising out of the Loan.
9. So long as any of the Obligations remain outstanding,
Radnet Management, Inc. (the "COMPANY") agrees as follows:
(i) FINANCIAL REPORTING. The Company shall furnish
the following documents or information to USBPS:
(A) Within 30 days after the end of each
Fiscal Quarter (as defined below) (i) (or 90 days in respect of the last month
of the fiscal year), the Company's consolidated, consolidating and on a center
by center basis, financial statements, including the most recent annual report,
balance sheet (not on a center by center basis) and income statement, prepared
in accordance with generally accepted accounting principles, which reports, the
Company warrants, shall fully and fairly represent the true financial condition
of the Company and (ii) updated projections for the Company and for each center;
(B) any other financial information normally
provided by the Company to the public; and
(C) Such other financial data or information
relative to this Amendment Agreement, including, without limitation, listings of
serial numbers or other identification data and confirmations of such
information, as USBPS may time-to-time reasonably request.
(ii) NO AMENDMENTS. Subsequent to the date of this
Amendment Agreement, the Company will not agree or consent to any amendments or
modifications to any agreement between the Company and DVI, GECC or Xxxxx Fargo
Foothill, Inc. ("FOOTHILL") containing terms (including, but not limited to,
increasing interest rates, accelerating the principal amortization or maturity,
new or more stringent defaults, additional collateral, and new remedies
provisions) that would be more onerous to the Company, or adversely impact or
affect GECC with respect to the terms of this Amendment Agreement.
(iii) DISTRIBUTIONS. The Company shall not make any
distribution or declare or pay any dividends (in cash or other property, other
than common stock) on, or purchase, acquire, redeem, or retire any of the
Company's stock, of any class, whether now or hereafter outstanding
(collectively, "DISTRIBUTIONS"); PROVIDED, HOWEVER, that so long as no
4
#3155-008
default shall have occurred and be continuing immediately prior to or after
giving effect to any such payment, (a) the Company may make Distributions to
Primedex Health Systems, Inc., a New York corporation (the "PARENT") (1) in
amounts necessary to pay customary expenses of Parent in the ordinary course of
its business as a public holding company (including salaries and related
reasonable and customary expenses incurred by employees of Parent) in an
aggregate amount not to exceed $750,000 in any fiscal year, (2) in amounts
necessary to enable Parent to pay taxes when due and owing by it in the ordinary
course of its business as a holding company and (3) in amounts necessary to
enable Parent to pay interest on those certain 11.5% Series A Convertible
Subordinated Notes due June 30, 2008, issued by Parent on June 25, 1993, and (b)
Parent may make Distributions in the form of common stock.
(iv) FIXED CHARGE COVERAGE RATIO. Commencing April
30, 2005, the Company shall not permit the Fixed Charge Coverage Ratio, (a) to
be less than 1.0:1 as of the end of each April, July, October and January (each,
a "FISCAL QUARTER") ending prior to January 1, 2007, and (b) to be less than
1.05:1 as of the last day of each Fiscal Quarter ending thereafter. "FIXED
CHARGE COVERAGE RATIO" means for any period, the ratio of (i) EBITDA for such
period MINUS cash capital expenditures made (to the extent not already incurred
in a prior period) or incurred during such period, to (ii) the sum of (a)
interest expense, (b) principal payments required to be paid during such period
in respect of indebtedness, and (c) all federal, state, and local income taxes
accrued, all as determined for the twelve months ending on the determination
date for the Company and its subsidiaries on a consolidated basis without
duplication and in accordance with generally accepted accounting principles
consistently applied. "EBITDA" means, with respect to any fiscal period, the
Company's and its subsidiaries' consolidated net earnings (or loss), minus
extraordinary gains and interest income, plus interest expense, income taxes,
and depreciation and amortization for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(v) LEVERAGE RATIO. The Company shall not permit the
Leverage Ratio, as determined as of the end of each Fiscal Quarter, to be
greater than the amount set forth in the following table for the Fiscal Quarters
ending in the period set forth opposite thereto:
LEVERAGE RATIO PERIOD
-------------- ------
4.50:1.0 04/30/05 - 10/30/05
4.30:1.0 10/31/05 - 10/30/06
4.00:1.0 10/31/06 - 10/30/07
3.80:1.0 10/31/07 - 10/30/08
"LEVERAGE RATIO" means, at any date of determination, the
ratio of (a) Total Debt at such date to (b) EBITDA for the applicable period
ending on such date. "TOTAL DEBT" means, as of any date of determination,
without duplication, the sum of (a) the outstanding aggregate amount of the
obligations for borrowed money, (b) the outstanding principal amount of capital
leases, (c) the outstanding principal amount of purchase money indebtedness, (d)
the outstanding principal amount of funded debt, and (e) the outstanding
principal amount of all obligations
5
#3155-008
owing to GECC, DVI and USBPS; all as determined for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(vi) EBITDA MARGIN. The Company shall not permit the
EBITDA Margin to be less than 25% as of the end of any Fiscal Quarter ending on
or after April 30, 2005. "EBITDA MARGIN" means for any period, the ratio of (a)
EBITDA for such period, to (b) net revenues (excluding the professional service
fee component of radiology services) for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(vii) RECEIVABLE DAYS. The Company shall not permit
the Receivable Days to exceed 65 days as of the end of any Fiscal Quarter ending
on or after April 30, 2005. "RECEIVABLE DAYS" means for any period, a number
equal to (a) 365 divided by (b) the result of (i) net revenues for such period
divided by (ii) net receivables for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(viii) NAME CHANGES, ETC. The Company agrees that it
shall not change its name or jurisdiction of organization without giving 30 days
prior written notice to USBPS.
10. To induce USBPS on behalf of the Trustee to enter this
Agreement, the Guarantor hereby affirms and restates its Guarantee as related to
this Loan and AMENDED AND RESTATED RIDER A.
11. Radnet, the Company and the Guarantor each represent and
warrant that each has been represented by an attorney of its choice and is fully
aware of the terms contained in this Agreement and AMENDED AND RESTATED RIDER A
to which it is a party which was voluntarily entered into without coercion or
duress of any kind.
12. Radnet represents and warrants to USBPS on behalf of the
Noteholders and Trustee that all necessary actions on the part of Radnet to be
taken in connection with the execution, delivery and performance of this
Agreement have been taken; the performance by Radnet of this Agreement and the
AMENDED AND RESTATED RIDER A will not violate any of
6
#3155-008
Radnet's Articles of Incorporation, Articles of Formation, Partnership Agreement
or other agreement or law by which Radnet is bound.
13. Any notice, request, direction, consent, approval, waiver
or other communication required or permitted under this Agreement to be sent
must be in writing and will become effective only upon delivery to USBPS at the
address set forth herein as follows:
U.S. Bank Portfolio Services
0000 Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxx, XX 00000
Attn: Xxxx Xxx, Director of Operations
14. Except as provided herein, and in the AMENDED AND RESTATED
RIDER A, all of the other provisions of the Loan Documents not restated will
remain in effect.
15. This Agreement and the documents referenced herein
constitute the entire and final agreement among the parties with respect to the
subject matter hereof and there are no agreements, understandings, warranties or
representations among the parties with respect to these matters except as set
forth herein.
16. This Agreement will inure to the benefit of and bind the
parties and their respective successors and permitted assigns.
17. Neither this Agreement nor any of the provisions hereof
can be changed, waived, discharged or terminated except by an instrument in
writing signed by the parties against whom such enforcement of the change,
waiver, discharge or termination is sought.
18. This Agreement will be interpreted and construed under the
laws of the Commonwealth of Pennsylvania, regardless of the domicile of any
party and will be considered to have been made, executed and performed in
Pennsylvania.
7
#3155-008
19. THE UNDERSIGNED, AND SUBJECT TO THE PROVISIONS CONTAINED
HEREIN, USBPS FOR ITSELF AND AS AGENT FOR THE TRUSTEE, (A) AGREE TO SUBMIT FOR
THEMSELVES, IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT AND ANY
SCHEDULE OR FOR RECOGNITION AND ENFORCEMENT OF ANY JUDGMENT IN RESPECT HEREOF OR
THEREOF, TO THE EXCLUSIVE JURISDICTION OF THE COURTS OF THE COMONWEALTH OF
PENNSYLVANIA, THE COURTS OF THE UNITED STATES OF AMERICA FOR THE EASTERN
DISTRICT OF PENNSYLVANIA, AND APPELLATE COURTS FROM ANY THEREOF, (B) CONSENT
THAT ANY ACTION OR PROCEEDING SHALL BE BROUGHT IN SUCH COURTS, AND WAIVE ANY
OBJECTION THAT EACH MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH ACTION OR
PROCEEDING IN ANY SUCH COURT, (C) AGREE THAT SERVICE OF PROCESS OF ANY SUCH
ACTION OR PROCEEDING MAY BE EFFECTED BY CERTIFIED MAIL (OR ANY SUBSTANTIALLY
SIMILAR FORM OF MAIL), POSTAGE PREPAID, TO THE APPROPRIATE PARTY AT ITS ADDRESS
AS SET FORTH HEREIN, AND SERVICE MADE SHALL BE DEEMED TO BE COMPLETED UPON THE
EARLIER OF ACTUAL RECEIPT OR FIVE (5) DAYS AFTER THE SAME SHALL HAVE BEEN POSTED
AS AFORESAID, AND (D) AGREE THAT NOTHING HEREIN OR IN ANY EXHIBIT OR SCHEDULE
SHALL AFFECT THE RIGHT TO EFFECT SERVICE OF PROCESS IN ANY OTHER MANNER
PERMITTED BY LAW. USBPS AND THE UNDERSIGNED EACH HEREBY UNCONDITIONALLY WAIVES
ITS RIGHT TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING
OUT OF, DIRECTLY OR INDIRECTLY, THIS AGREEMENT, ANY EXHIBIT AND THE TRANSACTIONS
8
#3155-008
CONTEMPLATED HEREBY AND THEREBY, ANY OF THE RELATED DOCUMENTS, ANY DEALINGS
BETWEEN THE PARTIES HERETO RELATING TO THE SUBJECT MATTER HEREOF OR THEREOF,
AND/OR THE RELATIONSHIP THAT IS BEING ESTABLISHED BETWEEN USBPS AS AGENT FOR THE
TRUSTEE AND THE UNDERSIGNED, PROVIDED USBPS MAY IN ITS DISCRETION ENFORCE THE
TERMS OF THE FORUM SELECTION PROVISIONS IN THE LOANS.
20. Radnet, the Company and the Guarantor hereby release
USBPS, the Trustee, and the Noteholders from and against any claim, loss, or
damage arising out of the negotiation execution, and performance of the Loan or
related matters prior to the date hereof.
21. This Agreement may be executed in two or more counterparts
and each counterpart shall be deemed an original.
9
#3155-008
LYON FINANCIAL SERVICES, INC. DBA U.S.
BANK PORTFOLIO SERVICES, AS SUCCESSOR
SERVICER FOR DVI RECEIVABLES XI, L.L.C.
AND AS AGENT FOR U.S. BANK, N.A., AS TRUSTEE
By:_________________________________________
RADNET MANAGEMENT, INC.
By:_________________________________________
ACKNOWLEDGED AND AGREED TO:
Primedex Health Systems, Inc., Guarantor
By:_____________________________________
10
#3155-007
AMENDMENT TO LOAN DOCUMENTS
---------------------------
AGREEMENT made as of June 30, 2004 ("AMENDMENT AGREEMENT" or
"AGREEMENT") by and between LYON FINANCIAL SERVICES, INC. DBA U.S. BANK
PORTFOLIO SERVICES, as Successor Servicer for DVI Receivables XI, L.L.C. and as
Agent for U.S. Bank, N.A., as Trustee, with offices at 0000 Xxxxxx Xxxxxx, Xxxxx
000, Xxxxxxxx, Xxxxxxxxx 00000 ("USBPS") and Radnet Management, Inc., a
corporation, with offices at 0000 Xxxxxx Xxxxxx, Xxx Xxxxxxx, XX 00000
("RADNET"), and such other signatories hereto.
WHEREAS, on or about July 11, 2001, Radnet executed and
delivered to DVI Financial Services Inc. ("DVI") a Master Loan Agreement
collectively with the Secured Promissory Note Number #3155-007 dated August 15,
2001 (the "LOAN");
WHEREAS, to secure the payment of the Loan and all other
obligations of Radnet to DVI (collectively the "OBLIGATIONS"), Radnet, pursuant
to a Master Security Agreement dated on or about July 11, 2001 (the "SECURITY
AGREEMENT"), granted DVI a first priority security interest in certain
Collateral described therein;
WHEREAS, to further secure payment of the Note and all other
Obligations of Radnet to DVI, Radnet delivered to DVI the guarantee (the
"GUARANTEE") of Primedex Health Systems, Inc. (the "GUARANTOR") (the "GUARANTEE"
together with the Loan and ancillary documents are, collectively the "LOAN
DOCUMENTS");
WHEREAS, substantially contemporaneously therewith, DVI
contributed all of the Loan Documents to DVI Receivables XI, L.L.C. ("DVI XI")
and thereafter pursuant to an Amended and Restated Indenture, DVI XI granted a
first priority security interest in and pledged all of the Loan Documents in
favor of U.S. Bank, N.A., as Trustee, for the benefit of a
#3155-007
noteholder which purchased asset backed promissory notes issued by DVI XI (the
"Noteholder");
WHEREAS, DVI contributed other Loans with Radnet or certain
affiliates of Radnet to this and other DVI securitizations (collectively the
"RELATED LOANS");
WHEREAS, Radnet is in default under the terms of the Loan;
WHEREAS, Radnet has requested USBPS to modify the Loan to
reflect an adjustment in payments;
WHEREAS, Radnet and/or certain of its affiliates have agreed
to modify the Related Loans;
WHEREAS, Radnet and certain of its affiliates are engaged in
negotiations to restructure or modify certain loan agreements, loans and
promissory notes with each of General Electric Capital Corporation ("GECC") and
DVI (with respect to GECC, the "GECC MODIFICATION", and with respect to DVI, the
"DVI MODIFICATION");
WHEREAS, subject to the following terms and conditions, USBPS
is willing to modify the Loan as hereinafter provided.
NOW, THEREFORE, the parties agree as follows:
1. All of the Whereas clauses are incorporated herein as if
hereinafter set forth at full length.
2. Radnet acknowledges that it is duly indebted to the Trustee
in the sum set forth on AMENDED AND RESTATED RIDER A annexed hereto, and has no
defenses, counterclaims or offsets to such indebtedness.
3. USBPS as Agent for the Trustee will modify the Loan to
provide for payments to commence in accordance with the attached revised payment
schedule (the
2
#3155-007
"AMENDED AND RESTATED RIDER A"). Radnet may, at any time, prepay all of the then
outstanding Obligations subject to an additional prepayment fee of 2% of such
Obligations. Partial prepayments of the Obligations shall not be permitted at
any time.
4. This Agreement shall become effective upon the date that
USBPS receives this Agreement duly executed by Radnet and the satisfaction of
each of the following conditions:
(a) Radnet and/or its affiliates shall have entered
into agreements on similar terms to this Agreement and
otherwise in form and substance satisfactory to USBPS,
relating to the Related Loans (the "Related Loan
Modifications");
(b) reimbursement of USBPS's legal fees incurred in
connection with the execution of this Agreement and the
Related Loan Modifications, aggregating $50,000, shall have
been received by USBPS;
(c) Radnet and/or its affiliates shall have entered
into the GECC Modification and the DVI Modification.
5. The closing of the restructuring of the Radnet Loan is
further subject to delivery to USBPS of all of the following, each in form and
substance satisfactory to USBPS and its counsel:
(a) The executed AMENDED AND RESTATED RIDER A;
(b) An executed copy of this Agreement;
(c) Such other documents, including UCC financing
statements as USBPS reasonably requests.
6. Radnet hereby acknowledges and agrees that it has no, and
will not assert any, defenses, counterclaims or offsets to the Loan and AMENDED
AND RESTATED RIDER A and acknowledges and agrees that the Trustee holds a
first-priority security interest in the Collateral.
7. Any default or other breach of any obligation under the
GECC Modification, the DVI Modification, or any of the Related Loan
Modifications shall constitute a
3
#3155-007
default under the Loan as modified by this Agreement, and USBPS shall have all
remedies thereunder.
8. Radnet hereby releases the Noteholder, USBPS individually
and as agent for the Trustee and the special purpose entities for which the
Trustee holds collateral, from and against any claims, loss or damage of any
kind or nature arising out of the Loan.
9. So long as any of the Obligations remain outstanding,
Radnet Management, Inc. (the "COMPANY") agrees as follows:
(i) FINANCIAL REPORTING. The Company shall furnish
the following documents or information to USBPS:
(A) Within 30 days after the end of each
Fiscal Quarter (as defined below) (i) (or 90 days in respect of the last month
of the fiscal year), the Company's consolidated, consolidating and on a center
by center basis, financial statements, including the most recent annual report,
balance sheet (not on a center by center basis) and income statement, prepared
in accordance with generally accepted accounting principles, which reports, the
Company warrants, shall fully and fairly represent the true financial condition
of the Company and (ii) updated projections for the Company and for each center;
(B) any other financial information normally
provided by the Company to the public; and
(C) Such other financial data or information
relative to this Amendment Agreement, including, without limitation, listings of
serial numbers or other identification data and confirmations of such
information, as USBPS may time-to-time reasonably request.
(ii) NO AMENDMENTS. Subsequent to the date of this
Amendment Agreement, the Company will not agree or consent to any amendments or
modifications to any agreement between the Company and DVI, GECC or Xxxxx Fargo
Foothill, Inc. ("FOOTHILL") containing terms (including, but not limited to,
increasing interest rates, accelerating the principal amortization or maturity,
new or more stringent defaults, additional collateral, and new remedies
provisions) that would be more onerous to the Company, or adversely impact or
affect GECC with respect to the terms of this Amendment Agreement.
(iii) DISTRIBUTIONS. The Company shall not make any
distribution or declare or pay any dividends (in cash or other property, other
than common stock) on, or purchase, acquire, redeem, or retire any of the
Company's stock, of any class, whether now or hereafter outstanding
(collectively, "DISTRIBUTIONS"); PROVIDED, HOWEVER, that so long as no
4
#3155-007
default shall have occurred and be continuing immediately prior to or after
giving effect to any such payment, (a) the Company may make Distributions to
Primedex Health Systems, Inc., a New York corporation (the "PARENT") (1) in
amounts necessary to pay customary expenses of Parent in the ordinary course of
its business as a public holding company (including salaries and related
reasonable and customary expenses incurred by employees of Parent) in an
aggregate amount not to exceed $750,000 in any fiscal year, (2) in amounts
necessary to enable Parent to pay taxes when due and owing by it in the ordinary
course of its business as a holding company and (3) in amounts necessary to
enable Parent to pay interest on those certain 11.5% Series A Convertible
Subordinated Notes due June 30, 2008, issued by Parent on June 25, 1993, and (b)
Parent may make Distributions in the form of common stock.
(iv) FIXED CHARGE COVERAGE RATIO. Commencing April
30, 2005, the Company shall not permit the Fixed Charge Coverage Ratio, (a) to
be less than 1.0:1 as of the end of each April, July, October and January (each,
a "FISCAL QUARTER") ending prior to January 1, 2007, and (b) to be less than
1.05:1 as of the last day of each Fiscal Quarter ending thereafter. "FIXED
CHARGE COVERAGE RATIO" means for any period, the ratio of (i) EBITDA for such
period minus cash capital expenditures made (to the extent not already incurred
in a prior period) or incurred during such period, to (ii) the sum of (a)
interest expense, (b) principal payments required to be paid during such period
in respect of indebtedness, and (c) all federal, state, and local income taxes
accrued, all as determined for the twelve months ending on the determination
date for the Company and its subsidiaries on a consolidated basis without
duplication and in accordance with generally accepted accounting principles
consistently applied. "EBITDA" means, with respect to any fiscal period, the
Company's and its subsidiaries' consolidated net earnings (or loss), minus
extraordinary gains and interest income, plus interest expense, income taxes,
and depreciation and amortization for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(v) LEVERAGE RATIO. The Company shall not permit the
Leverage Ratio, as determined as of the end of each Fiscal Quarter, to be
greater than the amount set forth in the following table for the Fiscal Quarters
ending in the period set forth opposite thereto:
LEVERAGE RATIO PERIOD
-------------- ------
4.50:1.0 04/30/05 - 10/30/05
4.30:1.0 10/31/05 - 10/30/06
4.00:1.0 10/31/06 - 10/30/07
3.80:1.0 10/31/07 - 10/30/08
"LEVERAGE RATIO" means, at any date of determination, the
ratio of (a) Total Debt at such date to (b) EBITDA for the applicable period
ending on such date. "TOTAL DEBT" means, as of any date of determination,
without duplication, the sum of (a) the outstanding aggregate amount of the
obligations for borrowed money, (b) the outstanding principal amount of capital
leases, (c) the outstanding principal amount of purchase money indebtedness, (d)
the outstanding principal amount of funded debt, and (e) the outstanding
principal amount of all obligations
5
#3155-007
owing to GECC, DVI and USBPS; all as determined for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(vi) EBITDA MARGIN. The Company shall not permit the
EBITDA Margin to be less than 25% as of the end of any Fiscal Quarter ending on
or after April 30, 2005. "EBITDA MARGIN" means for any period, the ratio of (a)
EBITDA for such period, to (b) net revenues (excluding the professional service
fee component of radiology services) for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(vii) RECEIVABLE DAYS. The Company shall not permit
the Receivable Days to exceed 65 days as of the end of any Fiscal Quarter ending
on or after April 30, 2005. "RECEIVABLE DAYS" means for any period, a number
equal to (a) 365 divided by (b) the result of (i) net revenues for such period
divided by (ii) net receivables for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(viii) NAME CHANGES, ETC. The Company agrees that it
shall not change its name or jurisdiction of organization without giving 30 days
prior written notice to USBPS.
10. To induce USBPS on behalf of the Trustee to enter this
Agreement, the Guarantor hereby affirms and restates its Guarantee as related to
this Loan and AMENDED AND RESTATED RIDER A.
11. Radnet, the Company and the Guarantor each represent and
warrant that each has been represented by an attorney of its choice and is fully
aware of the terms contained in this Agreement and AMENDED AND RESTATED RIDER A
to which it is a party which was voluntarily entered into without coercion or
duress of any kind.
12. Radnet represents and warrants to USBPS on behalf of the
Noteholders and Trustee that all necessary actions on the part of Radnet to be
taken in connection with the execution, delivery and performance of this
Agreement have been taken; the performance by Radnet of this Agreement and the
AMENDED AND RESTATED RIDER A will not violate any of
6
#3155-007
Radnet's Articles of Incorporation, Articles of Formation, Partnership Agreement
or other agreement or law by which Radnet is bound.
13. Any notice, request, direction, consent, approval, waiver
or other communication required or permitted under this Agreement to be sent
must be in writing and will become effective only upon delivery to USBPS at the
address set forth herein as follows:
U.S. Bank Portfolio Services
0000 Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxx, XX 00000
Attn: Xxxx Xxx, Director of Operations
14. Except as provided herein, and in the AMENDED AND RESTATED
RIDER A, all of the other provisions of the Loan Documents not restated will
remain in effect.
15. This Agreement and the documents referenced herein
constitute the entire and final agreement among the parties with respect to the
subject matter hereof and there are no agreements, understandings, warranties or
representations among the parties with respect to these matters except as set
forth herein.
16. This Agreement will inure to the benefit of and bind the
parties and their respective successors and permitted assigns.
17. Neither this Agreement nor any of the provisions hereof
can be changed, waived, discharged or terminated except by an instrument in
writing signed by the parties against whom such enforcement of the change,
waiver, discharge or termination is sought.
18. This Agreement will be interpreted and construed under the
laws of the Commonwealth of Pennsylvania, regardless of the domicile of any
party and will be considered to have been made, executed and performed in
Pennsylvania.
7
#3155-007
19. THE UNDERSIGNED, AND SUBJECT TO THE PROVISIONS CONTAINED
HEREIN, USBPS FOR ITSELF AND AS AGENT FOR THE TRUSTEE, (A) AGREE TO SUBMIT FOR
THEMSELVES, IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT AND ANY
SCHEDULE OR FOR RECOGNITION AND ENFORCEMENT OF ANY JUDGMENT IN RESPECT HEREOF OR
THEREOF, TO THE EXCLUSIVE JURISDICTION OF THE COURTS OF THE COMONWEALTH OF
PENNSYLVANIA, THE COURTS OF THE UNITED STATES OF AMERICA FOR THE EASTERN
DISTRICT OF PENNSYLVANIA, AND APPELLATE COURTS FROM ANY THEREOF, (B) CONSENT
THAT ANY ACTION OR PROCEEDING SHALL BE BROUGHT IN SUCH COURTS, AND WAIVE ANY
OBJECTION THAT EACH MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH ACTION OR
PROCEEDING IN ANY SUCH COURT, (C) AGREE THAT SERVICE OF PROCESS OF ANY SUCH
ACTION OR PROCEEDING MAY BE EFFECTED BY CERTIFIED MAIL (OR ANY SUBSTANTIALLY
SIMILAR FORM OF MAIL), POSTAGE PREPAID, TO THE APPROPRIATE PARTY AT ITS ADDRESS
AS SET FORTH HEREIN, AND SERVICE MADE SHALL BE DEEMED TO BE COMPLETED UPON THE
EARLIER OF ACTUAL RECEIPT OR FIVE (5) DAYS AFTER THE SAME SHALL HAVE BEEN POSTED
AS AFORESAID, AND (D) AGREE THAT NOTHING HEREIN OR IN ANY EXHIBIT OR SCHEDULE
SHALL AFFECT THE RIGHT TO EFFECT SERVICE OF PROCESS IN ANY OTHER MANNER
PERMITTED BY LAW. USBPS AND THE UNDERSIGNED EACH HEREBY UNCONDITIONALLY WAIVES
ITS RIGHT TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING
OUT OF, DIRECTLY OR INDIRECTLY, THIS AGREEMENT, ANY EXHIBIT AND THE TRANSACTIONS
8
#3155-007
CONTEMPLATED HEREBY AND THEREBY, ANY OF THE RELATED DOCUMENTS, ANY DEALINGS
BETWEEN THE PARTIES HERETO RELATING TO THE SUBJECT MATTER HEREOF OR THEREOF,
AND/OR THE RELATIONSHIP THAT IS BEING ESTABLISHED BETWEEN USBPS AS AGENT FOR THE
TRUSTEE AND THE UNDERSIGNED, PROVIDED USBPS MAY IN ITS DISCRETION ENFORCE THE
TERMS OF THE FORUM SELECTION PROVISIONS IN THE LOANS.
20. Radnet, the Company and the Guarantor hereby release
USBPS, the Trustee, and the Noteholders from and against any claim, loss, or
damage arising out of the negotiation execution, and performance of the Loan or
related matters prior to the date hereof.
21. This Agreement may be executed in two or more counterparts
and each counterpart shall be deemed an original.
9
#3155-007
LYON FINANCIAL SERVICES, INC. DBA U.S.
BANK PORTFOLIO SERVICES, AS SUCCESSOR
SERVICER FOR DVI RECEIVABLES XI, L.L.C.
AND AS AGENT FOR U.S. BANK, N.A., AS TRUSTEE
By:_________________________________________
RADNET MANAGEMENT, INC.
By:_________________________________________
ACKNOWLEDGED AND AGREED TO:
Primedex Health Systems, Inc., Guarantor
By:_____________________________________
10
#3155-006
AMENDMENT TO LOAN DOCUMENTS
---------------------------
AGREEMENT made as of June 30, 2004 ("AMENDMENT AGREEMENT" or
"AGREEMENT") by and between LYON FINANCIAL SERVICES, INC. DBA U.S. BANK
PORTFOLIO SERVICES, as Successor Servicer for DVI Receivables XVI, L.L.C. and as
Agent for U.S. Bank, N.A., as Trustee, with offices at 0000 Xxxxxx Xxxxxx, Xxxxx
000, Xxxxxxxx, Xxxxxxxxx 00000 ("USBPS") and Radnet Management, Inc., a
corporation, with offices at 0000 Xxxxxx Xxxxxx, Xxx Xxxxxxx, XX 00000
("RADNET"), and such other signatories hereto.
WHEREAS, on or about July 11, 2001, Radnet executed and
delivered to DVI Financial Services Inc. ("DVI") a Master Loan Agreement
collectively with the Secured Promissory Note Number #3155-006 dated July 31,
2001 (the "LOAN");
WHEREAS, to secure the payment of the Loan and all other
obligations of Radnet to DVI (collectively the "OBLIGATIONS"), Radnet, pursuant
to a Master Security Agreement dated on or about July 11, 2001 (the "SECURITY
AGREEMENT"), granted DVI a first priority security interest in certain
Collateral described therein;
WHEREAS, to further secure payment of the Note and all other
Obligations of Radnet to DVI, Radnet delivered to DVI the guarantee (the
"GUARANTEE") of Primedex Health Systems, Inc. (the "GUARANTOR") (the "GUARANTEE"
together with the Loan and ancillary documents are, collectively the "LOAN
DOCUMENTS");
WHEREAS, substantially contemporaneously therewith, DVI
contributed all of the Loan Documents to DVI Receivables XVI, L.L.C. ("DVI XVI")
and thereafter pursuant to an Amended and Restated Indenture, DVI XVI granted a
first priority security interest in and pledged all of the Loan Documents in
favor of U.S. Bank, N.A., as Trustee, for the benefit of a
#3155-006
noteholder which purchased asset backed promissory notes issued by DVI XVI (the
"Noteholder");
WHEREAS, DVI contributed other Loans with Radnet or certain
affiliates of Radnet to this and other DVI securitizations (collectively the
"RELATED LOANS");
WHEREAS, Radnet is in default under the terms of the Loan;
WHEREAS, Radnet has requested USBPS to modify the Loan to
reflect an adjustment in payments;
WHEREAS, Radnet and/or certain of its affiliates have agreed
to modify the Related Loans;
WHEREAS, Radnet and certain of its affiliates are engaged in
negotiations to restructure or modify certain loan agreements, loans and
promissory notes with each of General Electric Capital Corporation ("GECC") and
DVI (with respect to GECC, the "GECC MODIFICATION", and with respect to DVI, the
"DVI MODIFICATION");
WHEREAS, subject to the following terms and conditions, USBPS
is willing to modify the Loan as hereinafter provided.
NOW, THEREFORE, the parties agree as follows:
1. All of the Whereas clauses are incorporated herein as if
hereinafter set forth at full length.
2. Radnet acknowledges that it is duly indebted to the Trustee
in the sum set forth on AMENDED AND RESTATED RIDER A annexed hereto, and has no
defenses, counterclaims or offsets to such indebtedness.
3. USBPS as Agent for the Trustee will modify the Loan to
provide for payments to commence in accordance with the attached revised payment
schedule (the
2
#3155-006
"AMENDED AND RESTATED RIDER A"). Radnet may, at any time, prepay all of the then
outstanding Obligations subject to an additional prepayment fee of 2% of such
Obligations. Partial prepayments of the Obligations shall not be permitted at
any time.
4. This Agreement shall become effective upon the date that
USBPS receives this Agreement duly executed by Radnet and the satisfaction of
each of the following conditions:
(a) Radnet and/or its affiliates shall have entered
into agreements on similar terms to this Agreement and
otherwise in form and substance satisfactory to USBPS,
relating to the Related Loans (the "Related Loan
Modifications");
(b) reimbursement of USBPS's legal fees incurred in
connection with the execution of this Agreement and the
Related Loan Modifications, aggregating $50,000, shall have
been received by USBPS;
(c) Radnet and/or its affiliates shall have entered
into the GECC Modification and the DVI Modification.
5. The closing of the restructuring of the Radnet Loan is
further subject to delivery to USBPS of all of the following, each in form and
substance satisfactory to USBPS and its counsel:
(a) The executed AMENDED AND RESTATED RIDER A;
(b) An executed copy of this Agreement;
(c) Such other documents, including UCC financing
statements as USBPS reasonably requests.
6. Radnet hereby acknowledges and agrees that it has no, and
will not assert any, defenses, counterclaims or offsets to the Loan and AMENDED
AND RESTATED RIDER A and acknowledges and agrees that the Trustee holds a
first-priority security interest in the Collateral.
7. Any default or other breach of any obligation under the
GECC Modification, the DVI Modification, or any of the Related Loan
Modifications shall constitute a
3
#3155-006 default under the Loan as modified by this Agreement, and USBPS shall
have all remedies thereunder.
8. Radnet hereby releases the Noteholder, USBPS individually
and as agent for the Trustee and the special purpose entities for which the
Trustee holds collateral, from and against any claims, loss or damage of any
kind or nature arising out of the Loan.
9. So long as any of the Obligations remain outstanding,
Radnet Management, Inc. (the "COMPANY") agrees as follows:
(i) FINANCIAL REPORTING. The Company shall furnish
the following documents or information to USBPS:
(A) Within 30 days after the end of each
Fiscal Quarter (as defined below) (i) (or 90 days in respect of the last month
of the fiscal year), the Company's consolidated, consolidating and on a center
by center basis, financial statements, including the most recent annual report,
balance sheet (not on a center by center basis) and income statement, prepared
in accordance with generally accepted accounting principles, which reports, the
Company warrants, shall fully and fairly represent the true financial condition
of the Company and (ii) updated projections for the Company and for each center;
(B) any other financial information normally
provided by the Company to the public; and
(C) Such other financial data or information
relative to this Amendment Agreement, including, without limitation, listings of
serial numbers or other identification data and confirmations of such
information, as USBPS may time-to-time reasonably request.
(ii) NO AMENDMENTS. Subsequent to the date of this
Amendment Agreement, the Company will not agree or consent to any amendments or
modifications to any agreement between the Company and DVI, GECC or Xxxxx Fargo
Foothill, Inc. ("FOOTHILL") containing terms (including, but not limited to,
increasing interest rates, accelerating the principal amortization or maturity,
new or more stringent defaults, additional collateral, and new remedies
provisions) that would be more onerous to the Company, or adversely impact or
affect GECC with respect to the terms of this Amendment Agreement.
(iii) DISTRIBUTIONS. The Company shall not make any
distribution or declare or pay any dividends (in cash or other property, other
than common stock) on, or purchase, acquire, redeem, or retire any of the
Company's stock, of any class, whether now or hereafter outstanding
(collectively, "DISTRIBUTIONS"); PROVIDED, HOWEVER, that so long as no
4
#3155-006
default shall have occurred and be continuing immediately prior to or after
giving effect to any such payment, (a) the Company may make Distributions to
Primedex Health Systems, Inc., a New York corporation (the "PARENT") (1) in
amounts necessary to pay customary expenses of Parent in the ordinary course of
its business as a public holding company (including salaries and related
reasonable and customary expenses incurred by employees of Parent) in an
aggregate amount not to exceed $750,000 in any fiscal year, (2) in amounts
necessary to enable Parent to pay taxes when due and owing by it in the ordinary
course of its business as a holding company and (3) in amounts necessary to
enable Parent to pay interest on those certain 11.5% Series A Convertible
Subordinated Notes due June 30, 2008, issued by Parent on June 25, 1993, and (b)
Parent may make Distributions in the form of common stock.
(iv) FIXED CHARGE COVERAGE RATIO. Commencing April
30, 2005, the Company shall not permit the Fixed Charge Coverage Ratio, (a) to
be less than 1.0:1 as of the end of each April, July, October and January (each,
a "FISCAL QUARTER") ending prior to January 1, 2007, and (b) to be less than
1.05:1 as of the last day of each Fiscal Quarter ending thereafter. "FIXED
CHARGE COVERAGE RATIO" means for any period, the ratio of (i) EBITDA for such
period minus cash capital expenditures made (to the extent not already incurred
in a prior period) or incurred during such period, to (ii) the sum of (a)
interest expense, (b) principal payments required to be paid during such period
in respect of indebtedness, and (c) all federal, state, and local income taxes
accrued, all as determined for the twelve months ending on the determination
date for the Company and its subsidiaries on a consolidated basis without
duplication and in accordance with generally accepted accounting principles
consistently applied. "EBITDA" means, with respect to any fiscal period, the
Company's and its subsidiaries' consolidated net earnings (or loss), minus
extraordinary gains and interest income, plus interest expense, income taxes,
and depreciation and amortization for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(v) LEVERAGE RATIO. The Company shall not permit the
Leverage Ratio, as determined as of the end of each Fiscal Quarter, to be
greater than the amount set forth in the following table for the Fiscal Quarters
ending in the period set forth opposite thereto:
LEVERAGE RATIO PERIOD
-------------- ------
4.50:1.0 04/30/05 - 10/30/05
4.30:1.0 10/31/05 - 10/30/06
4.00:1.0 10/31/06 - 10/30/07
3.80:1.0 10/31/07 - 10/30/08
"LEVERAGE RATIO" means, at any date of determination, the
ratio of (a) Total Debt at such date to (b) EBITDA for the applicable period
ending on such date. "TOTAL DEBT" means, as of any date of determination,
without duplication, the sum of (a) the outstanding aggregate amount of the
obligations for borrowed money, (b) the outstanding principal amount of capital
leases, (c) the outstanding principal amount of purchase money indebtedness, (d)
the outstanding principal amount of funded debt, and (e) the outstanding
principal amount of all obligations
5
#3155-006
owing to GECC, DVI and USBPS; all as determined for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(vi) EBITDA MARGIN. The Company shall not permit the
EBITDA Margin to be less than 25% as of the end of any Fiscal Quarter ending on
or after April 30, 2005. "EBITDA MARGIN" means for any period, the ratio of (a)
EBITDA for such period, to (b) net revenues (excluding the professional service
fee component of radiology services) for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(vii) RECEIVABLE DAYS. The Company shall not permit
the Receivable Days to exceed 65 days as of the end of any Fiscal Quarter ending
on or after April 30, 2005. "RECEIVABLE DAYS" means for any period, a number
equal to (a) 365 divided by (b) the result of (i) net revenues for such period
divided by (ii) net receivables for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(viii) NAME CHANGES, ETC. The Company agrees that it
shall not change its name or jurisdiction of organization without giving 30 days
prior written notice to USBPS.
10. To induce USBPS on behalf of the Trustee to enter this
Agreement, the Guarantor hereby affirms and restates its Guarantee as related to
this Loan and AMENDED AND RESTATED RIDER A.
11. Radnet, the Company and the Guarantor each represent and
warrant that each has been represented by an attorney of its choice and is fully
aware of the terms contained in this Agreement and AMENDED AND RESTATED RIDER A
to which it is a party which was voluntarily entered into without coercion or
duress of any kind.
12. Radnet represents and warrants to USBPS on behalf of the
Noteholders and Trustee that all necessary actions on the part of Radnet to be
taken in connection with the execution, delivery and performance of this
Agreement have been taken; the performance by Radnet of this Agreement and the
AMENDED AND RESTATED RIDER A will not violate any of
6
#3155-006
Radnet's Articles of Incorporation, Articles of Formation, Partnership Agreement
or other agreement or law by which Radnet is bound.
13. Any notice, request, direction, consent, approval, waiver
or other communication required or permitted under this Agreement to be sent
must be in writing and will become effective only upon delivery to USBPS at the
address set forth herein as follows:
U.S. Bank Portfolio Services
0000 Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxx, XX 00000
Attn: Xxxx Xxx, Director of Operations
14. Except as provided herein, and in the AMENDED AND RESTATED
RIDER A, all of the other provisions of the Loan Documents not restated will
remain in effect.
15. This Agreement and the documents referenced herein
constitute the entire and final agreement among the parties with respect to the
subject matter hereof and there are no agreements, understandings, warranties or
representations among the parties with respect to these matters except as set
forth herein.
16. This Agreement will inure to the benefit of and bind the
parties and their respective successors and permitted assigns.
17. Neither this Agreement nor any of the provisions hereof
can be changed, waived, discharged or terminated except by an instrument in
writing signed by the parties against whom such enforcement of the change,
waiver, discharge or termination is sought.
18. This Agreement will be interpreted and construed under the
laws of the Commonwealth of Pennsylvania, regardless of the domicile of any
party and will be considered to have been made, executed and performed in
Pennsylvania.
7
#3155-006
19. THE UNDERSIGNED, AND SUBJECT TO THE PROVISIONS CONTAINED
HEREIN, USBPS FOR ITSELF AND AS AGENT FOR THE TRUSTEE, (A) AGREE TO SUBMIT FOR
THEMSELVES, IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT AND ANY
SCHEDULE OR FOR RECOGNITION AND ENFORCEMENT OF ANY JUDGMENT IN RESPECT HEREOF OR
THEREOF, TO THE EXCLUSIVE JURISDICTION OF THE COURTS OF THE COMONWEALTH OF
PENNSYLVANIA, THE COURTS OF THE UNITED STATES OF AMERICA FOR THE EASTERN
DISTRICT OF PENNSYLVANIA, AND APPELLATE COURTS FROM ANY THEREOF, (B) CONSENT
THAT ANY ACTION OR PROCEEDING SHALL BE BROUGHT IN SUCH COURTS, AND WAIVE ANY
OBJECTION THAT EACH MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH ACTION OR
PROCEEDING IN ANY SUCH COURT, (C) AGREE THAT SERVICE OF PROCESS OF ANY SUCH
ACTION OR PROCEEDING MAY BE EFFECTED BY CERTIFIED MAIL (OR ANY SUBSTANTIALLY
SIMILAR FORM OF MAIL), POSTAGE PREPAID, TO THE APPROPRIATE PARTY AT ITS ADDRESS
AS SET FORTH HEREIN, AND SERVICE MADE SHALL BE DEEMED TO BE COMPLETED UPON THE
EARLIER OF ACTUAL RECEIPT OR FIVE (5) DAYS AFTER THE SAME SHALL HAVE BEEN POSTED
AS AFORESAID, AND (D) AGREE THAT NOTHING HEREIN OR IN ANY EXHIBIT OR SCHEDULE
SHALL AFFECT THE RIGHT TO EFFECT SERVICE OF PROCESS IN ANY OTHER MANNER
PERMITTED BY LAW. USBPS AND THE UNDERSIGNED EACH HEREBY UNCONDITIONALLY WAIVES
ITS RIGHT TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING
OUT OF, DIRECTLY OR INDIRECTLY, THIS AGREEMENT, ANY EXHIBIT AND THE TRANSACTIONS
8
#3155-006
CONTEMPLATED HEREBY AND THEREBY, ANY OF THE RELATED DOCUMENTS, ANY DEALINGS
BETWEEN THE PARTIES HERETO RELATING TO THE SUBJECT MATTER HEREOF OR THEREOF,
AND/OR THE RELATIONSHIP THAT IS BEING ESTABLISHED BETWEEN USBPS AS AGENT FOR THE
TRUSTEE AND THE UNDERSIGNED, PROVIDED USBPS MAY IN ITS DISCRETION ENFORCE THE
TERMS OF THE FORUM SELECTION PROVISIONS IN THE LOANS.
20. Radnet, the Company and the Guarantor hereby release
USBPS, the Trustee, and the Noteholders from and against any claim, loss, or
damage arising out of the negotiation execution, and performance of the Loan or
related matters prior to the date hereof.
21. This Agreement may be executed in two or more counterparts
and each counterpart shall be deemed an original.
9
#3155-006
LYON FINANCIAL SERVICES, INC. DBA U.S.
BANK PORTFOLIO SERVICES, AS SUCCESSOR
SERVICER FOR DVI RECEIVABLES XVI, L.L.C.
AND AS AGENT FOR U.S. BANK, N.A., AS TRUSTEE
By:_________________________________________
RADNET MANAGEMENT, INC.
By:_________________________________________
ACKNOWLEDGED AND AGREED TO:
Primedex Health Systems, Inc., Guarantor
By:_____________________________________
10
#3155-004
AMENDMENT TO LOAN DOCUMENTS
---------------------------
AGREEMENT made as of June 30, 2004 ("AMENDMENT AGREEMENT" or
"AGREEMENT") by and between LYON FINANCIAL SERVICES, INC. DBA U.S. BANK
PORTFOLIO SERVICES, as Sub-Servicer for DVI Funding, L.L.C. and as Agent for
U.S. Bank, N.A., as Collateral Agent, with offices at 0000 Xxxxxx Xxxxxx, Xxxxx
000, Xxxxxxxx, Xxxxxxxxx 00000 ("USBPS") and Radnet Management, Inc., a
corporation, with offices at 0000 Xxxxxx Xxxxxx, Xxx Xxxxxxx, XX 00000
("RADNET"), and such other signatories hereto.
WHEREAS, on or about July 11, 2001, Radnet executed and
delivered to DVI Financial Services Inc. ("DVI") a Master Loan Agreement
collectively with the Secured Promissory Note Number #3155-004 dated July 31,
2001 (the "LOAN");
WHEREAS, to secure the payment of the Loan and all other
obligations of Radnet to DVI (collectively the "OBLIGATIONS"), Radnet, pursuant
to a Master Security Agreement dated on or about July 11, 2001 (the "SECURITY
AGREEMENT"), granted DVI a first priority security interest in certain
Collateral described therein;
WHEREAS, to further secure payment of the Note and all other
Obligations of Radnet to DVI, Radnet delivered to DVI the guarantee (the
"GUARANTEE") of Primedex Health Systems, Inc. (the "GUARANTOR") (the "GUARANTEE"
together with the Loan and ancillary documents are, collectively the "LOAN
DOCUMENTS");
WHEREAS, substantially contemporaneously therewith, DVI
contributed all of the Loan Documents to DVI Funding, L.L.C. ("DVI FUNDING") and
thereafter pursuant to an Amended and Restated Indenture, DVI Funding granted a
first priority security interest in and pledged all of the Loan Documents in
favor of U.S. Bank, N.A., as Collateral Agent, for the
#3155-004
benefit of a noteholder which purchased asset backed promissory notes issued by
DVI Funding (the "Noteholder");
WHEREAS, DVI contributed other Loans with Radnet or certain
affiliates of Radnet to this and other DVI securitizations (collectively the
"RELATED LOANS");
WHEREAS, Radnet is in default under the terms of the Loan;
WHEREAS, Radnet has requested USBPS to modify the Loan to
reflect an adjustment in payments;
WHEREAS, Radnet and/or certain of its affiliates have agreed
to modify the Related Loans;
WHEREAS, Radnet and certain of its affiliates are engaged in
negotiations to restructure or modify certain loan agreements, loans and
promissory notes with each of General Electric Capital Corporation ("GECC") and
DVI (with respect to GECC, the "GECC MODIFICATION", and with respect to DVI, the
"DVI MODIFICATION");
WHEREAS, subject to the following terms and conditions, USBPS
is willing to modify the Loan as hereinafter provided.
NOW, THEREFORE, the parties agree as follows:
1. All of the Whereas clauses are incorporated herein as if
hereinafter set forth at full length.
2. Radnet acknowledges that it is duly indebted to the
Collateral Agent in the sum set forth on AMENDED AND RESTATED RIDER A annexed
hereto, and has no defenses, counterclaims or offsets to such indebtedness.
3. USBPS as Agent for the Collateral Agent will modify the
Loan to provide for payments to commence in accordance with the attached revised
payment schedule (the
2
#3155-004
"AMENDED AND RESTATED RIDER A"). Radnet may, at any time, prepay all of the then
outstanding Obligations subject to an additional prepayment fee of 2% of such
Obligations. Partial prepayments of the Obligations shall not be permitted at
any time.
4. This Agreement shall become effective upon the date that
USBPS receives this Agreement duly executed by Radnet and the satisfaction of
each of the following conditions:
(a) Radnet and/or its affiliates shall have entered
into agreements on similar terms to this Agreement and
otherwise in form and substance satisfactory to USBPS,
relating to the Related Loans (the "Related Loan
Modifications");
(b) reimbursement of USBPS's legal fees incurred in
connection with the execution of this Agreement and the
Related Loan Modifications, aggregating $50,000, shall have
been received by USBPS;
(c) Radnet and/or its affiliates shall have entered
into the GECC Modification and the DVI Modification.
5. The closing of the restructuring of the Radnet Loan is
further subject to delivery to USBPS of all of the following, each in form and
substance satisfactory to USBPS and its counsel:
(a) The executed AMENDED AND RESTATED RIDER A;
(b) An executed copy of this Agreement;
(c) Such other documents, including UCC financing
statements as USBPS reasonably requests.
6. Radnet hereby acknowledges and agrees that it has no, and
will not assert any, defenses, counterclaims or offsets to the Loan and AMENDED
AND RESTATED RIDER A and acknowledges and agrees that the Collateral Agent holds
a first-priority security interest in the Collateral.
3
7. Any default or other breach of any obligation under the
GECC Modification, the DVI Modification, or any of the Related Loan
Modifications shall constitute a default under the Loan as modified by this
Agreement, and USBPS shall have all remedies thereunder.
8. Radnet hereby releases the Noteholder, USBPS individually
and as agent for the Collateral Agent and the special purpose entities for which
the Collateral Agent holds collateral, from and against any claims, loss or
damage of any kind or nature arising out of the Loan.
9. So long as any of the Obligations remain outstanding,
Radnet Management, Inc. (the "COMPANY") agrees as follows:
(i) FINANCIAL REPORTING. The Company shall furnish
the following documents or information to USBPS:
(A) Within 30 days after the end of each
Fiscal Quarter (as defined below) (i) (or 90 days in respect of the last month
of the fiscal year), the Company's consolidated, consolidating and on a center
by center basis, financial statements, including the most recent annual report,
balance sheet (not on a center by center basis) and income statement, prepared
in accordance with generally accepted accounting principles, which reports, the
Company warrants, shall fully and fairly represent the true financial condition
of the Company and (ii) updated projections for the Company and for each center;
(B) any other financial information normally
provided by the Company to the public; and
(C) Such other financial data or information
relative to this Amendment Agreement, including, without limitation, listings of
serial numbers or other identification data and confirmations of such
information, as USBPS may time-to-time reasonably request.
(ii) NO AMENDMENTS. Subsequent to the date of this
Amendment Agreement, the Company will not agree or consent to any amendments or
modifications to any agreement between the Company and DVI, GECC or Xxxxx Fargo
Foothill, Inc. ("FOOTHILL") containing terms (including, but not limited to,
increasing interest rates, accelerating the principal amortization or maturity,
new or more stringent defaults, additional collateral, and new
4
#3155-004
remedies provisions) that would be more onerous to the Company, or adversely
impact or affect GECC with respect to the terms of this Amendment Agreement.
(iii) DISTRIBUTIONS. The Company shall not make any
distribution or declare or pay any dividends (in cash or other property, other
than common stock) on, or purchase, acquire, redeem, or retire any of the
Company's stock, of any class, whether now or hereafter outstanding
(collectively, "DISTRIBUTIONS"); PROVIDED, HOWEVER, that so long as no default
shall have occurred and be continuing immediately prior to or after giving
effect to any such payment, (a) the Company may make Distributions to Primedex
Health Systems, Inc., a New York corporation (the "PARENT") (1) in amounts
necessary to pay customary expenses of Parent in the ordinary course of its
business as a public holding company (including salaries and related reasonable
and customary expenses incurred by employees of Parent) in an aggregate amount
not to exceed $750,000 in any fiscal year, (2) in amounts necessary to enable
Parent to pay taxes when due and owing by it in the ordinary course of its
business as a holding company and (3) in amounts necessary to enable Parent to
pay interest on those certain 11.5% Series A Convertible Subordinated Notes due
June 30, 2008, issued by Parent on June 25, 1993, and (b) Parent may make
Distributions in the form of common stock.
(iv) FIXED CHARGE COVERAGE RATIO. Commencing April
30, 2005, the Company shall not permit the Fixed Charge Coverage Ratio, (a) to
be less than 1.0:1 as of the end of each April, July, October and January (each,
a "FISCAL QUARTER") ending prior to January 1, 2007, and (b) to be less than
1.05:1 as of the last day of each Fiscal Quarter ending thereafter. "FIXED
CHARGE COVERAGE RATIO" means for any period, the ratio of (i) EBITDA for such
period minus cash capital expenditures made (to the extent not already incurred
in a prior period) or incurred during such period, to (ii) the sum of (a)
interest expense, (b) principal payments required to be paid during such period
in respect of indebtedness, and (c) all federal, state, and local income taxes
accrued, all as determined for the twelve months ending on the determination
date for the Company and its subsidiaries on a consolidated basis without
duplication and in accordance with generally accepted accounting principles
consistently applied. "EBITDA" means, with respect to any fiscal period, the
Company's and its subsidiaries' consolidated net earnings (or loss), minus
extraordinary gains and interest income, plus interest expense, income taxes,
and depreciation and amortization for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(v) LEVERAGE RATIO. The Company shall not permit the
Leverage Ratio, as determined as of the end of each Fiscal Quarter, to be
greater than the amount set forth in the following table for the Fiscal Quarters
ending in the period set forth opposite thereto:
LEVERAGE RATIO PERIOD
-------------- ------
4.50:1.0 04/30/05 - 10/30/05
4.30:1.0 10/31/05 - 10/30/06
4.00:1.0 10/31/06 - 10/30/07
3.80:1.0 10/31/07 - 10/30/08
5
#3155-004
"LEVERAGE RATIO" means, at any date of determination, the
ratio of (a) Total Debt at such date to (b) EBITDA for the applicable period
ending on such date. "TOTAL DEBT" means, as of any date of determination,
without duplication, the sum of (a) the outstanding aggregate amount of the
obligations for borrowed money, (b) the outstanding principal amount of capital
leases, (c) the outstanding principal amount of purchase money indebtedness, (d)
the outstanding principal amount of funded debt, and (e) the outstanding
principal amount of all obligations owing to GECC, DVI and USBPS; all as
determined for the Company and its subsidiaries on a consolidated basis without
duplication and in accordance with generally accepted accounting principles
consistently applied.
(vi) EBITDA MARGIN. The Company shall not permit the
EBITDA Margin to be less than 25% as of the end of any Fiscal Quarter ending on
or after April 30, 2005. "EBITDA MARGIN" means for any period, the ratio of (a)
EBITDA for such period, to (b) net revenues (excluding the professional service
fee component of radiology services) for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(vii) RECEIVABLE DAYS. The Company shall not permit
the Receivable Days to exceed 65 days as of the end of any Fiscal Quarter ending
on or after April 30, 2005. "RECEIVABLE DAYS" means for any period, a number
equal to (a) 365 divided by (b) the result of (i) net revenues for such period
divided by (ii) net receivables for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(viii) NAME CHANGES, ETC. The Company agrees that it
shall not change its name or jurisdiction of organization without giving 30 days
prior written notice to USBPS.
10. To induce USBPS on behalf of the Collateral Agent to enter
this Agreement, the Guarantor hereby affirms and restates its Guarantee as
related to this Loan and AMENDED AND RESTATED RIDER A.
11. Radnet, the Company and the Guarantor each represent and
warrant that each has been represented by an attorney of its choice and is fully
aware of the terms contained in this Agreement and AMENDED AND RESTATED RIDER A
to which it is a party which was voluntarily entered into without coercion or
duress of any kind.
12. Radnet represents and warrants to USBPS on behalf of the
Noteholders and Collateral Agent that all necessary actions on the part of
Radnet to be taken in connection
6
#3155-004
with the execution, delivery and performance of this Agreement have been taken;
the performance by Radnet of this Agreement and the AMENDED AND RESTATED RIDER A
will not violate any of Radnet's Articles of Incorporation, Articles of
Formation, Partnership Agreement or other agreement or law by which Radnet is
bound.
13. Any notice, request, direction, consent, approval, waiver
or other communication required or permitted under this Agreement to be sent
must be in writing and will become effective only upon delivery to USBPS at the
address set forth herein as follows:
U.S. Bank Portfolio Services
0000 Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxx, XX 00000
Attn: Xxxx Xxx, Director of Operations
14. Except as provided herein, and in the AMENDED AND RESTATED
RIDER A, all of the other provisions of the Loan Documents not restated will
remain in effect.
15. This Agreement and the documents referenced herein
constitute the entire and final agreement among the parties with respect to the
subject matter hereof and there are no agreements, understandings, warranties or
representations among the parties with respect to these matters except as set
forth herein.
16. This Agreement will inure to the benefit of and bind the
parties and their respective successors and permitted assigns.
17. Neither this Agreement nor any of the provisions hereof
can be changed, waived, discharged or terminated except by an instrument in
writing signed by the parties against whom such enforcement of the change,
waiver, discharge or termination is sought.
7
18. This Agreement will be interpreted and construed under the
laws of the Commonwealth of Pennsylvania, regardless of the domicile of any
party and will be considered to have been made, executed and performed in
Pennsylvania.
19. THE UNDERSIGNED, AND SUBJECT TO THE PROVISIONS CONTAINED
HEREIN, USBPS FOR ITSELF AND AS AGENT FOR THE COLLATERAL AGENT, (A) AGREE TO
SUBMIT FOR THEMSELVES, IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS
AGREEMENT AND ANY SCHEDULE OR FOR RECOGNITION AND ENFORCEMENT OF ANY JUDGMENT IN
RESPECT HEREOF OR THEREOF, TO THE EXCLUSIVE JURISDICTION OF THE COURTS OF THE
COMONWEALTH OF PENNSYLVANIA, THE COURTS OF THE UNITED STATES OF AMERICA FOR THE
EASTERN DISTRICT OF PENNSYLVANIA, AND APPELLATE COURTS FROM ANY THEREOF, (B)
CONSENT THAT ANY ACTION OR PROCEEDING SHALL BE BROUGHT IN SUCH COURTS, AND WAIVE
ANY OBJECTION THAT EACH MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH
ACTION OR PROCEEDING IN ANY SUCH COURT, (C) AGREE THAT SERVICE OF PROCESS OF ANY
SUCH ACTION OR PROCEEDING MAY BE EFFECTED BY CERTIFIED MAIL (OR ANY
SUBSTANTIALLY SIMILAR FORM OF MAIL), POSTAGE PREPAID, TO THE APPROPRIATE PARTY
AT ITS ADDRESS AS SET FORTH HEREIN, AND SERVICE MADE SHALL BE DEEMED TO BE
COMPLETED UPON THE EARLIER OF ACTUAL RECEIPT OR FIVE (5) DAYS AFTER THE SAME
SHALL HAVE BEEN POSTED AS AFORESAID, AND (D) AGREE THAT NOTHING HEREIN OR IN ANY
EXHIBIT OR SCHEDULE SHALL AFFECT THE RIGHT TO EFFECT SERVICE OF PROCESS IN ANY
OTHER MANNER PERMITTED BY LAW. USBPS AND THE UNDERSIGNED EACH
8
#3155-004
HEREBY UNCONDITIONALLY WAIVES ITS RIGHT TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF
ACTION BASED UPON OR ARISING OUT OF, DIRECTLY OR INDIRECTLY, THIS AGREEMENT, ANY
EXHIBIT AND THE TRANSACTIONS CONTEMPLATED HEREBY AND THEREBY, ANY OF THE RELATED
DOCUMENTS, ANY DEALINGS BETWEEN THE PARTIES HERETO RELATING TO THE SUBJECT
MATTER HEREOF OR THEREOF, AND/OR THE RELATIONSHIP THAT IS BEING ESTABLISHED
BETWEEN USBPS AS AGENT FOR THE TRUSTEE AND THE UNDERSIGNED, PROVIDED USBPS MAY
IN ITS DISCRETION ENFORCE THE TERMS OF THE FORUM SELECTION PROVISIONS IN THE
LOANS.
20. Radnet, the Company and the Guarantor hereby release
USBPS, the Collateral Agent, and the Noteholders from and against any claim,
loss, or damage arising out of the negotiation execution, and performance of the
Loan or related matters prior to the date hereof.
21. This Agreement may be executed in two or more counterparts
and each counterpart shall be deemed an original.
9
#3155-004
LYON FINANCIAL SERVICES, INC. DBA U.S.
BANK PORTFOLIO SERVICES, AS SUB-SERVICER
FOR DVI FUNDING, L.L.C. AND AS AGENT
FOR U.S. BANK, N.A., AS COLLATERAL AGENT
By:_________________________________________
RADNET MANAGEMENT, INC.
By:_________________________________________
ACKNOWLEDGED AND AGREED TO:
Primedex Health Systems, Inc., Guarantor
By:_____________________________________
10
#3155-003
AMENDMENT TO LOAN DOCUMENTS
---------------------------
AGREEMENT made as of June 30, 2004 ("AMENDMENT AGREEMENT" or
"AGREEMENT") by and between LYON FINANCIAL SERVICES, INC. DBA U.S. BANK
PORTFOLIO SERVICES, as Sub-Servicer for DVI Funding, L.L.C. and as Agent for
U.S. Bank, N.A., as Collateral Agent, with offices at 0000 Xxxxxx Xxxxxx, Xxxxx
000, Xxxxxxxx, Xxxxxxxxx 00000 ("USBPS") and Radnet Management, Inc., a
corporation, with offices at 0000 Xxxxxx Xxxxxx, Xxx Xxxxxxx, XX 00000
("RADNET"), and such other signatories hereto.
WHEREAS, on or about July 11, 2001, Radnet executed and
delivered to DVI Financial Services Inc. ("DVI") a Master Loan Agreement
collectively with the Secured Promissory Note Number #3155-003 dated July 31,
2001 (the "LOAN");
WHEREAS, to secure the payment of the Loan and all other
obligations of Radnet to DVI (collectively the "OBLIGATIONS"), Radnet, pursuant
to a Master Security Agreement dated on or about July 11, 2001 (the "SECURITY
AGREEMENT"), granted DVI a first priority security interest in certain
Collateral described therein;
WHEREAS, to further secure payment of the Note and all other
Obligations of Radnet to DVI, Radnet delivered to DVI the guarantee (the
"GUARANTEE") of Primedex Health Systems, Inc. (the "GUARANTOR") (the "GUARANTEE"
together with the Loan and ancillary documents are, collectively the "LOAN
DOCUMENTS");
WHEREAS, substantially contemporaneously therewith, DVI
contributed all of the Loan Documents to DVI Funding, L.L.C. ("DVI FUNDING") and
thereafter pursuant to an Amended and Restated Indenture, DVI Funding granted a
first priority security interest in and pledged all of the Loan Documents in
favor of U.S. Bank, N.A., as Collateral Agent, for the
#3155-003
benefit of a noteholder which purchased asset backed promissory notes issued by
DVI Funding (the "Noteholder");
WHEREAS, DVI contributed other Loans with Radnet or certain
affiliates of Radnet to this and other DVI securitizations (collectively the
"RELATED LOANS");
WHEREAS, Radnet is in default under the terms of the Loan;
WHEREAS, Radnet has requested USBPS to modify the Loan to
reflect an adjustment in payments;
WHEREAS, Radnet and/or certain of its affiliates have agreed
to modify the Related Loans;
WHEREAS, Radnet and certain of its affiliates are engaged in
negotiations to restructure or modify certain loan agreements, loans and
promissory notes with each of General Electric Capital Corporation ("GECC") and
DVI (with respect to GECC, the "GECC MODIFICATION", and with respect to DVI, the
"DVI MODIFICATION");
WHEREAS, subject to the following terms and conditions, USBPS
is willing to modify the Loan as hereinafter provided.
NOW, THEREFORE, the parties agree as follows:
1. All of the Whereas clauses are incorporated herein as if
hereinafter set forth at full length.
2. Radnet acknowledges that it is duly indebted to the
Collateral Agent in the sum set forth on AMENDED AND RESTATED RIDER A annexed
hereto, and has no defenses, counterclaims or offsets to such indebtedness.
3. USBPS as Agent for the Collateral Agent will modify the
Loan to provide for payments to commence in accordance with the attached revised
payment schedule (the
2
#3155-003
"AMENDED AND RESTATED RIDER A"). Radnet may, at any time, prepay all of the then
outstanding Obligations subject to an additional prepayment fee of 2% of such
Obligations. Partial prepayments of the Obligations shall not be permitted at
any time.
4. This Agreement shall become effective upon the date that
USBPS receives this Agreement duly executed by Radnet and the satisfaction of
each of the following conditions:
(a) Radnet and/or its affiliates shall have entered
into agreements on similar terms to this Agreement and
otherwise in form and substance satisfactory to USBPS,
relating to the Related Loans (the "Related Loan
Modifications");
(b) reimbursement of USBPS's legal fees incurred in
connection with the execution of this Agreement and the
Related Loan Modifications, aggregating $50,000, shall have
been received by USBPS;
(c) Radnet and/or its affiliates shall have entered
into the GECC Modification and the DVI Modification.
5. The closing of the restructuring of the Radnet Loan is
further subject to delivery to USBPS of all of the following, each in form and
substance satisfactory to USBPS and its counsel:
(a) The executed AMENDED AND RESTATED RIDER A;
(b) An executed copy of this Agreement;
(c) Such other documents, including UCC financing
statements as USBPS reasonably requests.
6. Radnet hereby acknowledges and agrees that it has no, and
will not assert any, defenses, counterclaims or offsets to the Loan and AMENDED
AND RESTATED RIDER A and acknowledges and agrees that the Collateral Agent holds
a first-priority security interest in the Collateral.
3
7. Any default or other breach of any obligation under the
GECC Modification, the DVI Modification, or any of the Related Loan
Modifications shall constitute a default under the Loan as modified by this
Agreement, and USBPS shall have all remedies thereunder.
8. Radnet hereby releases the Noteholder, USBPS individually
and as agent for the Collateral Agent and the special purpose entities for which
the Collateral Agent holds collateral, from and against any claims, loss or
damage of any kind or nature arising out of the Loan.
9. So long as any of the Obligations remain outstanding,
Radnet Management, Inc. (the "COMPANY") agrees as follows:
(i) FINANCIAL REPORTING. The Company shall furnish
the following documents or information to USBPS:
(A) Within 30 days after the end of each
Fiscal Quarter (as defined below) (i) (or 90 days in respect of the last month
of the fiscal year), the Company's consolidated, consolidating and on a center
by center basis, financial statements, including the most recent annual report,
balance sheet (not on a center by center basis) and income statement, prepared
in accordance with generally accepted accounting principles, which reports, the
Company warrants, shall fully and fairly represent the true financial condition
of the Company and (ii) updated projections for the Company and for each center;
(B) any other financial information normally
provided by the Company to the public; and
(C) Such other financial data or information
relative to this Amendment Agreement, including, without limitation, listings of
serial numbers or other identification data and confirmations of such
information, as USBPS may time-to-time reasonably request.
(ii) NO AMENDMENTS. Subsequent to the date of this
Amendment Agreement, the Company will not agree or consent to any amendments or
modifications to any agreement between the Company and DVI, GECC or Xxxxx Fargo
Foothill, Inc. ("FOOTHILL") containing terms (including, but not limited to,
increasing interest rates, accelerating the principal amortization or maturity,
new or more stringent defaults, additional collateral, and new
4
#3155-003
remedies provisions) that would be more onerous to the Company, or adversely
impact or affect GECC with respect to the terms of this Amendment Agreement.
(iii) DISTRIBUTIONS. The Company shall not make any
distribution or declare or pay any dividends (in cash or other property, other
than common stock) on, or purchase, acquire, redeem, or retire any of the
Company's stock, of any class, whether now or hereafter outstanding
(collectively, "DISTRIBUTIONS"); PROVIDED, HOWEVER, that so long as no default
shall have occurred and be continuing immediately prior to or after giving
effect to any such payment, (a) the Company may make Distributions to Primedex
Health Systems, Inc., a New York corporation (the "PARENT") (1) in amounts
necessary to pay customary expenses of Parent in the ordinary course of its
business as a public holding company (including salaries and related reasonable
and customary expenses incurred by employees of Parent) in an aggregate amount
not to exceed $750,000 in any fiscal year, (2) in amounts necessary to enable
Parent to pay taxes when due and owing by it in the ordinary course of its
business as a holding company and (3) in amounts necessary to enable Parent to
pay interest on those certain 11.5% Series A Convertible Subordinated Notes due
June 30, 2008, issued by Parent on June 25, 1993, and (b) Parent may make
Distributions in the form of common stock.
(iv) FIXED CHARGE COVERAGE RATIO. Commencing April
30, 2005, the Company shall not permit the Fixed Charge Coverage Ratio, (a) to
be less than 1.0:1 as of the end of each April, July, October and January (each,
a "FISCAL QUARTER") ending prior to January 1, 2007, and (b) to be less than
1.05:1 as of the last day of each Fiscal Quarter ending thereafter. "FIXED
CHARGE COVERAGE RATIO" means for any period, the ratio of (i) EBITDA for such
period minus cash capital expenditures made (to the extent not already incurred
in a prior period) or incurred during such period, to (ii) the sum of (a)
interest expense, (b) principal payments required to be paid during such period
in respect of indebtedness, and (c) all federal, state, and local income taxes
accrued, all as determined for the twelve months ending on the determination
date for the Company and its subsidiaries on a consolidated basis without
duplication and in accordance with generally accepted accounting principles
consistently applied. "EBITDA" means, with respect to any fiscal period, the
Company's and its subsidiaries' consolidated net earnings (or loss), minus
extraordinary gains and interest income, plus interest expense, income taxes,
and depreciation and amortization for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(v) LEVERAGE RATIO. The Company shall not permit the
Leverage Ratio, as determined as of the end of each Fiscal Quarter, to be
greater than the amount set forth in the following table for the Fiscal Quarters
ending in the period set forth opposite thereto:
LEVERAGE RATIO PERIOD
-------------- ------
4.50:1.0 04/30/05 - 10/30/05
4.30:1.0 10/31/05 - 10/30/06
4.00:1.0 10/31/06 - 10/30/07
3.80:1.0 10/31/07 - 10/30/08
5
#3155-003
"LEVERAGE RATIO" means, at any date of determination, the
ratio of (a) Total Debt at such date to (b) EBITDA for the applicable period
ending on such date. "TOTAL DEBT" means, as of any date of determination,
without duplication, the sum of (a) the outstanding aggregate amount of the
obligations for borrowed money, (b) the outstanding principal amount of capital
leases, (c) the outstanding principal amount of purchase money indebtedness, (d)
the outstanding principal amount of funded debt, and (e) the outstanding
principal amount of all obligations owing to GECC, DVI and USBPS; all as
determined for the Company and its subsidiaries on a consolidated basis without
duplication and in accordance with generally accepted accounting principles
consistently applied.
(vi) EBITDA MARGIN. The Company shall not permit the
EBITDA Margin to be less than 25% as of the end of any Fiscal Quarter ending on
or after April 30, 2005. "EBITDA MARGIN" means for any period, the ratio of (a)
EBITDA for such period, to (b) net revenues (excluding the professional service
fee component of radiology services) for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(vii) RECEIVABLE DAYS. The Company shall not permit
the Receivable Days to exceed 65 days as of the end of any Fiscal Quarter ending
on or after April 30, 2005. "RECEIVABLE DAYS" means for any period, a number
equal to (a) 365 divided by (b) the result of (i) net revenues for such period
divided by (ii) net receivables for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(viii) NAME CHANGES, ETC. The Company agrees that it
shall not change its name or jurisdiction of organization without giving 30 days
prior written notice to USBPS.
10. To induce USBPS on behalf of the Collateral Agent to enter
this Agreement, the Guarantor hereby affirms and restates its Guarantee as
related to this Loan and AMENDED AND RESTATED RIDER A.
11. Radnet, the Company and the Guarantor each represent and
warrant that each has been represented by an attorney of its choice and is fully
aware of the terms contained in this Agreement and AMENDED AND RESTATED RIDER A
to which it is a party which was voluntarily entered into without coercion or
duress of any kind.
12. Radnet represents and warrants to USBPS on behalf of the
Noteholders and Collateral Agent that all necessary actions on the part of
Radnet to be taken in connection
6
#3155-003
with the execution, delivery and performance of this Agreement have been taken;
the performance by Radnet of this Agreement and the AMENDED AND RESTATED RIDER A
will not violate any of Radnet's Articles of Incorporation, Articles of
Formation, Partnership Agreement or other agreement or law by which Radnet is
bound.
13. Any notice, request, direction, consent, approval, waiver
or other communication required or permitted under this Agreement to be sent
must be in writing and will become effective only upon delivery to USBPS at the
address set forth herein as follows:
U.S. Bank Portfolio Services
0000 Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxx, XX 00000
Attn: Xxxx Xxx, Director of Operations
14. Except as provided herein, and in the AMENDED AND RESTATED
RIDER A, all of the other provisions of the Loan Documents not restated will
remain in effect.
15. This Agreement and the documents referenced herein
constitute the entire and final agreement among the parties with respect to the
subject matter hereof and there are no agreements, understandings, warranties or
representations among the parties with respect to these matters except as set
forth herein.
16. This Agreement will inure to the benefit of and bind the
parties and their respective successors and permitted assigns.
17. Neither this Agreement nor any of the provisions hereof
can be changed, waived, discharged or terminated except by an instrument in
writing signed by the parties against whom such enforcement of the change,
waiver, discharge or termination is sought.
7
18. This Agreement will be interpreted and construed under the
laws of the Commonwealth of Pennsylvania, regardless of the domicile of any
party and will be considered to have been made, executed and performed in
Pennsylvania.
19. THE UNDERSIGNED, AND SUBJECT TO THE PROVISIONS CONTAINED
HEREIN, USBPS FOR ITSELF AND AS AGENT FOR THE COLLATERAL AGENT, (A) AGREE TO
SUBMIT FOR THEMSELVES, IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS
AGREEMENT AND ANY SCHEDULE OR FOR RECOGNITION AND ENFORCEMENT OF ANY JUDGMENT IN
RESPECT HEREOF OR THEREOF, TO THE EXCLUSIVE JURISDICTION OF THE COURTS OF THE
COMONWEALTH OF PENNSYLVANIA, THE COURTS OF THE UNITED STATES OF AMERICA FOR THE
EASTERN DISTRICT OF PENNSYLVANIA, AND APPELLATE COURTS FROM ANY THEREOF, (B)
CONSENT THAT ANY ACTION OR PROCEEDING SHALL BE BROUGHT IN SUCH COURTS, AND WAIVE
ANY OBJECTION THAT EACH MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH
ACTION OR PROCEEDING IN ANY SUCH COURT, (C) AGREE THAT SERVICE OF PROCESS OF ANY
SUCH ACTION OR PROCEEDING MAY BE EFFECTED BY CERTIFIED MAIL (OR ANY
SUBSTANTIALLY SIMILAR FORM OF MAIL), POSTAGE PREPAID, TO THE APPROPRIATE PARTY
AT ITS ADDRESS AS SET FORTH HEREIN, AND SERVICE MADE SHALL BE DEEMED TO BE
COMPLETED UPON THE EARLIER OF ACTUAL RECEIPT OR FIVE (5) DAYS AFTER THE SAME
SHALL HAVE BEEN POSTED AS AFORESAID, AND (D) AGREE THAT NOTHING HEREIN OR IN ANY
EXHIBIT OR SCHEDULE SHALL AFFECT THE RIGHT TO EFFECT SERVICE OF PROCESS IN ANY
OTHER MANNER PERMITTED BY LAW. USBPS AND THE UNDERSIGNED EACH
8
#3155-003
HEREBY UNCONDITIONALLY WAIVES ITS RIGHT TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF
ACTION BASED UPON OR ARISING OUT OF, DIRECTLY OR INDIRECTLY, THIS AGREEMENT, ANY
EXHIBIT AND THE TRANSACTIONS CONTEMPLATED HEREBY AND THEREBY, ANY OF THE RELATED
DOCUMENTS, ANY DEALINGS BETWEEN THE PARTIES HERETO RELATING TO THE SUBJECT
MATTER HEREOF OR THEREOF, AND/OR THE RELATIONSHIP THAT IS BEING ESTABLISHED
BETWEEN USBPS AS AGENT FOR THE TRUSTEE AND THE UNDERSIGNED, PROVIDED USBPS MAY
IN ITS DISCRETION ENFORCE THE TERMS OF THE FORUM SELECTION PROVISIONS IN THE
LOANS.
20. Radnet, the Company and the Guarantor hereby release
USBPS, the Collateral Agent, and the Noteholders from and against any claim,
loss, or damage arising out of the negotiation execution, and performance of the
Loan or related matters prior to the date hereof.
21. This Agreement may be executed in two or more counterparts
and each counterpart shall be deemed an original.
9
#3155-003
LYON FINANCIAL SERVICES, INC. DBA U.S.
BANK PORTFOLIO SERVICES, AS SUB-SERVICER
FOR DVI FUNDING, L.L.C. AND AS AGENT FOR
U.S. BANK, N.A., AS COLLATERAL AGENT
By:_________________________________________
RADNET MANAGEMENT, INC.
By:_________________________________________
ACKNOWLEDGED AND AGREED TO:
Primedex Health Systems, Inc., Guarantor
By:_____________________________________
10
#3155-001
AMENDMENT TO LOAN DOCUMENTS
---------------------------
AGREEMENT made as of June 30, 2004 ("AMENDMENT AGREEMENT" or
"AGREEMENT") by and between LYON FINANCIAL SERVICES, INC. DBA U.S. BANK
PORTFOLIO SERVICES, as Successor Servicer for DVI Receivables XVIII, L.L.C. and
as Agent for U.S. Bank, N.A., as Trustee, with offices at 0000 Xxxxxx Xxxxxx,
Xxxxx 000, Xxxxxxxx, Xxxxxxxxx 00000 ("USBPS") and Radnet Management, Inc., a
corporation, with offices at 0000 Xxxxxx Xxxxxx, Xxx Xxxxxxx, XX 00000
("RADNET"), and such other signatories hereto.
WHEREAS, on or about July 11, 2001, Radnet executed and
delivered to DVI Financial Services Inc. ("DVI") a Master Loan Agreement
collectively with the Secured Promissory Note Number #3155-001 dated July 11,
2001 (the "LOAN");
WHEREAS, to secure the payment of the Loan and all other
obligations of Radnet to DVI (collectively the "OBLIGATIONS"), Radnet, pursuant
to a Master Security Agreement dated on or about July 11, 2001 (the "SECURITY
AGREEMENT"), granted DVI a first priority security interest in certain
Collateral described therein;
WHEREAS, to further secure payment of the Note and all other
Obligations of Radnet to DVI, Radnet delivered to DVI the guarantee (the
"GUARANTEE") of Primedex Health Systems, Inc. (the "GUARANTOR") (the "GUARANTEE"
together with the Loan and ancillary documents are, collectively the "LOAN
DOCUMENTS");
WHEREAS, substantially contemporaneously therewith, DVI
contributed all of the Loan Documents to DVI Receivables XVIII, L.L.C. ("DVI
XVIII") and thereafter pursuant to an Amended and Restated Indenture, DVI XVIII
granted a first priority security interest in and pledged all of the Loan
Documents in favor of U.S. Bank, N.A., as Trustee, for the benefit of a
#3155-001
noteholder which purchased asset backed promissory notes issued by DVI XVIII
(the "Noteholder");
WHEREAS, DVI contributed other Loans with Radnet or certain
affiliates of Radnet to this and other DVI securitizations (collectively the
"RELATED LOANS");
WHEREAS, Radnet is in default under the terms of the Loan;
WHEREAS, Radnet has requested USBPS to modify the Loan to
reflect an adjustment in payments;
WHEREAS, Radnet and/or certain of its affiliates have agreed
to modify the Related Loans;
WHEREAS, Radnet and certain of its affiliates are engaged in
negotiations to restructure or modify certain loan agreements, loans and
promissory notes with each of General Electric Capital Corporation ("GECC") and
DVI (with respect to GECC, the "GECC MODIFICATION", and with respect to DVI, the
"DVI MODIFICATION");
WHEREAS, subject to the following terms and conditions, USBPS
is willing to modify the Loan as hereinafter provided.
NOW, THEREFORE, the parties agree as follows:
1. All of the Whereas clauses are incorporated herein as if
hereinafter set forth at full length.
2. Radnet acknowledges that it is duly indebted to the Trustee
in the sum set forth on AMENDED AND RESTATED RIDER A annexed hereto, and has no
defenses, counterclaims or offsets to such indebtedness.
3. USBPS as Agent for the Trustee will modify the Loan to
provide for payments to commence in accordance with the attached revised payment
schedule (the
2
#3155-001
"AMENDED AND RESTATED RIDER A"). Radnet may, at any time, prepay all of the then
outstanding Obligations subject to an additional prepayment fee of 2% of such
Obligations. Partial prepayments of the Obligations shall not be permitted at
any time.
4. This Agreement shall become effective upon the date that
USBPS receives this Agreement duly executed by Radnet and the satisfaction of
each of the following conditions:
(a) Radnet and/or its affiliates shall have entered
into agreements on similar terms to this Agreement and
otherwise in form and substance satisfactory to USBPS,
relating to the Related Loans (the "Related Loan
Modifications");
(b) reimbursement of USBPS's legal fees incurred in
connection with the execution of this Agreement and the
Related Loan Modifications, aggregating $50,000, shall have
been received by USBPS;
(c) Radnet and/or its affiliates shall have entered
into the GECC Modification and the DVI Modification.
5. The closing of the restructuring of the Radnet Loan is
further subject to delivery to USBPS of all of the following, each in form and
substance satisfactory to USBPS and its counsel:
(a) The executed AMENDED AND RESTATED RIDER A;
(b) An executed copy of this Agreement;
(c) Such other documents, including UCC financing
statements as USBPS reasonably requests.
6. Radnet hereby acknowledges and agrees that it has no, and
will not assert any, defenses, counterclaims or offsets to the Loan and AMENDED
AND RESTATED RIDER A and acknowledges and agrees that the Trustee holds a
first-priority security interest in the Collateral.
7. Any default or other breach of any obligation under the
GECC Modification, the DVI Modification, or any of the Related Loan
Modifications shall constitute a
3
#3155-001
default under the Loan as modified by this Agreement, and USBPS shall have all
remedies thereunder.
8. Radnet hereby releases the Noteholder, USBPS individually
and as agent for the Trustee and the special purpose entities for which the
Trustee holds collateral, from and against any claims, loss or damage of any
kind or nature arising out of the Loan.
9. So long as any of the Obligations remain outstanding,
Radnet Management, Inc. (the "COMPANY") agrees as follows:
(i) FINANCIAL REPORTING. The Company shall furnish
the following documents or information to USBPS:
(A) Within 30 days after the end of each
Fiscal Quarter (as defined below) (i) (or 90 days in respect of the last month
of the fiscal year), the Company's consolidated, consolidating and on a center
by center basis, financial statements, including the most recent annual report,
balance sheet (not on a center by center basis) and income statement, prepared
in accordance with generally accepted accounting principles, which reports, the
Company warrants, shall fully and fairly represent the true financial condition
of the Company and (ii) updated projections for the Company and for each center;
(B) any other financial information normally
provided by the Company to the public; and
(C) Such other financial data or information
relative to this Amendment Agreement, including, without limitation, listings of
serial numbers or other identification data and confirmations of such
information, as USBPS may time-to-time reasonably request.
(ii) NO AMENDMENTS. Subsequent to the date of this
Amendment Agreement, the Company will not agree or consent to any amendments or
modifications to any agreement between the Company and DVI, GECC or Xxxxx Fargo
Foothill, Inc. ("FOOTHILL") containing terms (including, but not limited to,
increasing interest rates, accelerating the principal amortization or maturity,
new or more stringent defaults, additional collateral, and new remedies
provisions) that would be more onerous to the Company, or adversely impact or
affect GECC with respect to the terms of this Amendment Agreement.
(iii) DISTRIBUTIONS. The Company shall not make any
distribution or declare or pay any dividends (in cash or other property, other
than common stock) on, or purchase, acquire, redeem, or retire any of the
Company's stock, of any class, whether now or hereafter outstanding
(collectively, "DISTRIBUTIONS"); PROVIDED, HOWEVER, that so long as no
4
#3155-001
default shall have occurred and be continuing immediately prior to or after
giving effect to any such payment, (a) the Company may make Distributions to
Primedex Health Systems, Inc., a New York corporation (the "PARENT") (1) in
amounts necessary to pay customary expenses of Parent in the ordinary course of
its business as a public holding company (including salaries and related
reasonable and customary expenses incurred by employees of Parent) in an
aggregate amount not to exceed $750,000 in any fiscal year, (2) in amounts
necessary to enable Parent to pay taxes when due and owing by it in the ordinary
course of its business as a holding company and (3) in amounts necessary to
enable Parent to pay interest on those certain 11.5% Series A Convertible
Subordinated Notes due June 30, 2008, issued by Parent on June 25, 1993, and (b)
Parent may make Distributions in the form of common stock.
(iv) FIXED CHARGE COVERAGE RATIO. Commencing April
30, 2005, the Company shall not permit the Fixed Charge Coverage Ratio, (a) to
be less than 1.0:1 as of the end of each April, July, October and January (each,
a "FISCAL QUARTER") ending prior to January 1, 2007, and (b) to be less than
1.05:1 as of the last day of each Fiscal Quarter ending thereafter. "FIXED
CHARGE COVERAGE RATIO" means for any period, the ratio of (i) EBITDA for such
period MINUS cash capital expenditures made (to the extent not already incurred
in a prior period) or incurred during such period, to (ii) the sum of (a)
interest expense, (b) principal payments required to be paid during such period
in respect of indebtedness, and (c) all federal, state, and local income taxes
accrued, all as determined for the twelve months ending on the determination
date for the Company and its subsidiaries on a consolidated basis without
duplication and in accordance with generally accepted accounting principles
consistently applied. "EBITDA" means, with respect to any fiscal period, the
Company's and its subsidiaries' consolidated net earnings (or loss), minus
extraordinary gains and interest income, plus interest expense, income taxes,
and depreciation and amortization for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(v) LEVERAGE RATIO. The Company shall not permit the
Leverage Ratio, as determined as of the end of each Fiscal Quarter, to be
greater than the amount set forth in the following table for the Fiscal Quarters
ending in the period set forth opposite thereto:
LEVERAGE RATIO PERIOD
-------------- ------
4.50:1.0 04/30/05 - 10/30/05
4.30:1.0 10/31/05 - 10/30/06
4.00:1.0 10/31/06 - 10/30/07
3.80:1.0 10/31/07 - 10/30/08
"LEVERAGE RATIO" means, at any date of determination, the
ratio of (a) Total Debt at such date to (b) EBITDA for the applicable period
ending on such date. "TOTAL DEBT" means, as of any date of determination,
without duplication, the sum of (a) the outstanding aggregate amount of the
obligations for borrowed money, (b) the outstanding principal amount of capital
leases, (c) the outstanding principal amount of purchase money indebtedness, (d)
the outstanding principal amount of funded debt, and (e) the outstanding
principal amount of all obligations
5
#3155-001
owing to GECC, DVI and USBPS; all as determined for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(vi) EBITDA MARGIN. The Company shall not permit the
EBITDA Margin to be less than 25% as of the end of any Fiscal Quarter ending on
or after April 30, 2005. "EBITDA MARGIN" means for any period, the ratio of (a)
EBITDA for such period, to (b) net revenues (excluding the professional service
fee component of radiology services) for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(vii) RECEIVABLE DAYS. The Company shall not permit
the Receivable Days to exceed 65 days as of the end of any Fiscal Quarter ending
on or after April 30, 2005. "RECEIVABLE DAYS" means for any period, a number
equal to (a) 365 divided by (b) the result of (i) net revenues for such period
divided by (ii) net receivables for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(viii) NAME CHANGES, ETC. The Company agrees that it
shall not change its name or jurisdiction of organization without giving 30 days
prior written notice to USBPS.
10. To induce USBPS on behalf of the Trustee to enter this
Agreement, the Guarantor hereby affirms and restates its Guarantee as related to
this Loan and AMENDED AND RESTATED RIDER A.
11. Radnet, the Company and the Guarantor each represent and
warrant that each has been represented by an attorney of its choice and is fully
aware of the terms contained in this Agreement and AMENDED AND RESTATED RIDER A
to which it is a party which was voluntarily entered into without coercion or
duress of any kind.
12. Radnet represents and warrants to USBPS on behalf of the
Noteholders and Trustee that all necessary actions on the part of Radnet to be
taken in connection with the execution, delivery and performance of this
Agreement have been taken; the performance by Radnet of this Agreement and the
AMENDED AND RESTATED RIDER A will not violate any of
6
#3155-001
Radnet's Articles of Incorporation, Articles of Formation, Partnership Agreement
or other agreement or law by which Radnet is bound.
13. Any notice, request, direction, consent, approval, waiver
or other communication required or permitted under this Agreement to be sent
must be in writing and will become effective only upon delivery to USBPS at the
address set forth herein as follows:
U.S. Bank Portfolio Services
0000 Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxx, XX 00000
Attn: Xxxx Xxx, Director of Operations
14. Except as provided herein, and in the AMENDED AND RESTATED
RIDER A, all of the other provisions of the Loan Documents not restated will
remain in effect.
15. This Agreement and the documents referenced herein
constitute the entire and final agreement among the parties with respect to the
subject matter hereof and there are no agreements, understandings, warranties or
representations among the parties with respect to these matters except as set
forth herein.
16. This Agreement will inure to the benefit of and bind the
parties and their respective successors and permitted assigns.
17. Neither this Agreement nor any of the provisions hereof
can be changed, waived, discharged or terminated except by an instrument in
writing signed by the parties against whom such enforcement of the change,
waiver, discharge or termination is sought.
18. This Agreement will be interpreted and construed under the
laws of the Commonwealth of Pennsylvania, regardless of the domicile of any
party and will be considered to have been made, executed and performed in
Pennsylvania.
7
#3155-001
19. THE UNDERSIGNED, AND SUBJECT TO THE PROVISIONS CONTAINED
HEREIN, USBPS FOR ITSELF AND AS AGENT FOR THE TRUSTEE, (A) AGREE TO SUBMIT FOR
THEMSELVES, IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT AND ANY
SCHEDULE OR FOR RECOGNITION AND ENFORCEMENT OF ANY JUDGMENT IN RESPECT HEREOF OR
THEREOF, TO THE EXCLUSIVE JURISDICTION OF THE COURTS OF THE COMONWEALTH OF
PENNSYLVANIA, THE COURTS OF THE UNITED STATES OF AMERICA FOR THE EASTERN
DISTRICT OF PENNSYLVANIA, AND APPELLATE COURTS FROM ANY THEREOF, (B) CONSENT
THAT ANY ACTION OR PROCEEDING SHALL BE BROUGHT IN SUCH COURTS, AND WAIVE ANY
OBJECTION THAT EACH MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH ACTION OR
PROCEEDING IN ANY SUCH COURT, (C) AGREE THAT SERVICE OF PROCESS OF ANY SUCH
ACTION OR PROCEEDING MAY BE EFFECTED BY CERTIFIED MAIL (OR ANY SUBSTANTIALLY
SIMILAR FORM OF MAIL), POSTAGE PREPAID, TO THE APPROPRIATE PARTY AT ITS ADDRESS
AS SET FORTH HEREIN, AND SERVICE MADE SHALL BE DEEMED TO BE COMPLETED UPON THE
EARLIER OF ACTUAL RECEIPT OR FIVE (5) DAYS AFTER THE SAME SHALL HAVE BEEN POSTED
AS AFORESAID, AND (D) AGREE THAT NOTHING HEREIN OR IN ANY EXHIBIT OR SCHEDULE
SHALL AFFECT THE RIGHT TO EFFECT SERVICE OF PROCESS IN ANY OTHER MANNER
PERMITTED BY LAW. USBPS AND THE UNDERSIGNED EACH HEREBY UNCONDITIONALLY WAIVES
ITS RIGHT TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING
OUT OF, DIRECTLY OR INDIRECTLY, THIS AGREEMENT, ANY EXHIBIT AND THE TRANSACTIONS
8
#3155-001
CONTEMPLATED HEREBY AND THEREBY, ANY OF THE RELATED DOCUMENTS, ANY DEALINGS
BETWEEN THE PARTIES HERETO RELATING TO THE SUBJECT MATTER HEREOF OR THEREOF,
AND/OR THE RELATIONSHIP THAT IS BEING ESTABLISHED BETWEEN USBPS AS AGENT FOR THE
TRUSTEE AND THE UNDERSIGNED, PROVIDED USBPS MAY IN ITS DISCRETION ENFORCE THE
TERMS OF THE FORUM SELECTION PROVISIONS IN THE LOANS.
20. Radnet, the Company and the Guarantor hereby release
USBPS, the Trustee, and the Noteholders from and against any claim, loss, or
damage arising out of the negotiation execution, and performance of the Loan or
related matters prior to the date hereof.
21. This Agreement may be executed in two or more counterparts
and each counterpart shall be deemed an original.
9
#3155-001
LYON FINANCIAL SERVICES, INC. DBA U.S.
BANK PORTFOLIO SERVICES, AS SUCCESSOR
SERVICER FOR DVI RECEIVABLES XVIII, L.L.C.
AND AS AGENT FOR U.S. BANK, N.A., AS TRUSTEE
By:_________________________________________
RADNET MANAGEMENT, INC.
By:_________________________________________
ACKNOWLEDGED AND AGREED TO:
Primedex Health Systems, Inc., Guarantor
By:_____________________________________
10
#2839-002
AMENDMENT TO LOAN DOCUMENTS
---------------------------
AGREEMENT made as of June 30, 2004 ("AMENDMENT AGREEMENT" or
"AGREEMENT") by and between LYON FINANCIAL SERVICES, INC. DBA U.S. BANK
PORTFOLIO SERVICES, as Successor Servicer for DVI Receivables XVIII, L.L.C. and
as Agent for U.S. Bank, N.A., as Trustee, with offices at 0000 Xxxxxx Xxxxxx,
Xxxxx 000, Xxxxxxxx, Xxxxxxxxx 00000 ("USBPS") and SoCal MR Site Management,
Inc., a corporation, with offices at 0000 Xxxxxx Xxxxxx, Xxx Xxxxxxx, XX 00000
("SOCAL"), and such other signatories hereto.
WHEREAS, on or about October 27, 2000, SoCal executed and
delivered to DVI Financial Services Inc. ("DVI") a Master Loan Agreement
collectively with the Amended and Restated Secured Promissory Note Number
#2839-002 dated July 2, 2002 (the "LOAN");
WHEREAS, to secure the payment of the Loan and all other
obligations of SoCal to DVI (collectively the "OBLIGATIONS"), SoCal, pursuant to
a Master Security Agreement dated on or about October 27, 2000 (the "SECURITY
AGREEMENT"), granted DVI a first priority security interest in certain
Collateral described therein;
WHEREAS, to further secure payment of the Note and all other
Obligations of SoCal to DVI, SoCal delivered to DVI the guarantee (the
"GUARANTEE") of Primedex Health Systems, Inc. (the "GUARANTOR") (the "GUARANTEE"
together with the Loan and ancillary documents are, collectively the "LOAN
DOCUMENTS");
WHEREAS, substantially contemporaneously therewith, DVI
contributed all of the Loan Documents to DVI Receivables XVIII, L.L.C. ("DVI
XVIII") and thereafter pursuant to an Amended and Restated Indenture, DVI XVIII
granted a first priority security interest in and pledged all of the Loan
Documents in favor of U.S. Bank, N.A., as Trustee, for the benefit of a
#2839-002
noteholder which purchased asset backed promissory notes issued by DVI XVIII
(the "Noteholder");
WHEREAS, DVI contributed other Loans with SoCal or certain
affiliates of SoCal to this and other DVI securitizations (collectively the
"RELATED LOANS");
WHEREAS, SoCal is in default under the terms of the Loan;
WHEREAS, SoCal has requested USBPS to modify the Loan to
reflect an adjustment in payments;
WHEREAS, SoCal and/or certain of its affiliates have agreed to
modify the Related Loans;
WHEREAS, SoCal and certain of its affiliates are engaged in
negotiations to restructure or modify certain loan agreements, loans and
promissory notes with each of General Electric Capital Corporation ("GECC") and
DVI (with respect to GECC, the "GECC MODIFICATION", and with respect to DVI, the
"DVI MODIFICATION");
WHEREAS, subject to the following terms and conditions, USBPS
is willing to modify the Loan as hereinafter provided.
NOW, THEREFORE, the parties agree as follows:
1. All of the Whereas clauses are incorporated herein as if
hereinafter set forth at full length.
2. SoCal acknowledges that it is duly indebted to the Trustee
in the sum set forth on AMENDED AND RESTATED RIDER A annexed hereto, and has no
defenses, counterclaims or offsets to such indebtedness.
3. USBPS as Agent for the Trustee will modify the Loan to
provide for payments to commence in accordance with the attached revised payment
schedule (the
2
#2839-002
"AMENDED AND RESTATED RIDER A"). SoCal may, at any time, prepay all of the then
outstanding Obligations subject to an additional prepayment fee of 2% of such
Obligations. Partial prepayments of the Obligations shall not be permitted at
any time.
4. This Agreement shall become effective upon the date that
USBPS receives this Agreement duly executed by SoCal and the satisfaction of
each of the following conditions:
(a) SoCal and/or its affiliates shall have entered
into agreements on similar terms to this Agreement and
otherwise in form and substance satisfactory to USBPS,
relating to the Related Loans (the "Related Loan
Modifications");
(b) reimbursement of USBPS's legal fees incurred in
connection with the execution of this Agreement and the
Related Loan Modifications, aggregating $50,000, shall have
been received by USBPS;
(c) SoCal and/or its affiliates shall have entered
into the GECC Modification and the DVI Modification.
5. The closing of the restructuring of the SoCal Loan is
further subject to delivery to USBPS of all of the following, each in form and
substance satisfactory to USBPS and its counsel:
(a) The executed AMENDED AND RESTATED RIDER A;
(b) An executed copy of this Agreement;
(c) Such other documents, including UCC financing
statements as USBPS reasonably requests.
6. SoCal hereby acknowledges and agrees that it has no, and
will not assert any, defenses, counterclaims or offsets to the Loan and AMENDED
AND RESTATED RIDER A and acknowledges and agrees that the Trustee holds a
first-priority security interest in the Collateral.
7. Any default or other breach of any obligation under the
GECC Modification, the DVI Modification, or any of the Related Loan
Modifications shall constitute a
3
#2839-002
default under the Loan as modified by this Agreement, and USBPS shall have all
remedies thereunder.
8. SoCal hereby releases the Noteholder, USBPS individually
and as agent for the Trustee and the special purpose entities for which the
Trustee holds collateral, from and against any claims, loss or damage of any
kind or nature arising out of the Loan.
9. So long as any of the Obligations remain outstanding,
Radnet Management, Inc. (the "COMPANY") agrees as follows:
(i) FINANCIAL REPORTING. The Company shall furnish
the following documents or information to USBPS:
(A) Within 30 days after the end of each
Fiscal Quarter (as defined below) (i) (or 90 days in respect of the last month
of the fiscal year), the Company's consolidated, consolidating and on a center
by center basis, financial statements, including the most recent annual report,
balance sheet (not on a center by center basis) and income statement, prepared
in accordance with generally accepted accounting principles, which reports, the
Company warrants, shall fully and fairly represent the true financial condition
of the Company and (ii) updated projections for the Company and for each center;
(B) any other financial information normally
provided by the Company to the public; and
(C) Such other financial data or information
relative to this Amendment Agreement, including, without limitation, listings of
serial numbers or other identification data and confirmations of such
information, as USBPS may time-to-time reasonably request.
(ii) NO AMENDMENTS. Subsequent to the date of this
Amendment Agreement, the Company will not agree or consent to any amendments or
modifications to any agreement between the Company and DVI, GECC or Xxxxx Fargo
Foothill, Inc. ("FOOTHILL") containing terms (including, but not limited to,
increasing interest rates, accelerating the principal amortization or maturity,
new or more stringent defaults, additional collateral, and new remedies
provisions) that would be more onerous to the Company, or adversely impact or
affect GECC with respect to the terms of this Amendment Agreement.
(iii) DISTRIBUTIONS. The Company shall not make any
distribution or declare or pay any dividends (in cash or other property, other
than common stock) on, or purchase, acquire, redeem, or retire any of the
Company's stock, of any class, whether now or hereafter outstanding
(collectively, "DISTRIBUTIONS"); PROVIDED, HOWEVER, that so long as no
4
#2839-002
default shall have occurred and be continuing immediately prior to or after
giving effect to any such payment, (a) the Company may make Distributions to
Primedex Health Systems, Inc., a New York corporation (the "PARENT") (1) in
amounts necessary to pay customary expenses of Parent in the ordinary course of
its business as a public holding company (including salaries and related
reasonable and customary expenses incurred by employees of Parent) in an
aggregate amount not to exceed $750,000 in any fiscal year, (2) in amounts
necessary to enable Parent to pay taxes when due and owing by it in the ordinary
course of its business as a holding company and (3) in amounts necessary to
enable Parent to pay interest on those certain 11.5% Series A Convertible
Subordinated Notes due June 30, 2008, issued by Parent on June 25, 1993, and (b)
Parent may make Distributions in the form of common stock.
(iv) FIXED CHARGE COVERAGE RATIO. Commencing April
30, 2005, the Company shall not permit the Fixed Charge Coverage Ratio, (a) to
be less than 1.0:1 as of the end of each April, July, October and January (each,
a "FISCAL QUARTER") ending prior to January 1, 2007, and (b) to be less than
1.05:1 as of the last day of each Fiscal Quarter ending thereafter. "FIXED
CHARGE COVERAGE RATIO" means for any period, the ratio of (i) EBITDA for such
period MINUS cash capital expenditures made (to the extent not already incurred
in a prior period) or incurred during such period, to (ii) the sum of (a)
interest expense, (b) principal payments required to be paid during such period
in respect of indebtedness, and (c) all federal, state, and local income taxes
accrued, all as determined for the twelve months ending on the determination
date for the Company and its subsidiaries on a consolidated basis without
duplication and in accordance with generally accepted accounting principles
consistently applied. "EBITDA" means, with respect to any fiscal period, the
Company's and its subsidiaries' consolidated net earnings (or loss), minus
extraordinary gains and interest income, plus interest expense, income taxes,
and depreciation and amortization for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(v) LEVERAGE RATIO. The Company shall not permit the
Leverage Ratio, as determined as of the end of each Fiscal Quarter, to be
greater than the amount set forth in the following table for the Fiscal Quarters
ending in the period set forth opposite thereto:
LEVERAGE RATIO PERIOD
-------------- ------
4.50:1.0 04/30/05 - 10/30/05
4.30:1.0 10/31/05 - 10/30/06
4.00:1.0 10/31/06 - 10/30/07
3.80:1.0 10/31/07 - 10/30/08
"LEVERAGE RATIO" means, at any date of determination, the
ratio of (a) Total Debt at such date to (b) EBITDA for the applicable period
ending on such date. "TOTAL DEBT" means, as of any date of determination,
without duplication, the sum of (a) the outstanding aggregate amount of the
obligations for borrowed money, (b) the outstanding principal amount of capital
leases, (c) the outstanding principal amount of purchase money indebtedness, (d)
the outstanding principal amount of funded debt, and (e) the outstanding
principal amount of all obligations
5
#2839-002
owing to GECC, DVI and USBPS; all as determined for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(vi) EBITDA MARGIN. The Company shall not permit the
EBITDA Margin to be less than 25% as of the end of any Fiscal Quarter ending on
or after April 30, 2005. "EBITDA MARGIN" means for any period, the ratio of (a)
EBITDA for such period, to (b) net revenues (excluding the professional service
fee component of radiology services) for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(vii) RECEIVABLE DAYS. The Company shall not permit
the Receivable Days to exceed 65 days as of the end of any Fiscal Quarter ending
on or after April 30, 2005. "RECEIVABLE DAYS" means for any period, a number
equal to (a) 365 divided by (b) the result of (i) net revenues for such period
divided by (ii) net receivables for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(viii) NAME CHANGES, ETC. The Company agrees that it
shall not change its name or jurisdiction of organization without giving 30 days
prior written notice to USBPS.
10. To induce USBPS on behalf of the Trustee to enter this
Agreement, the Guarantor hereby affirms and restates its Guarantee as related to
this Loan and AMENDED AND RESTATED RIDER A.
11. SoCal, the Company and the Guarantor each represent and
warrant that each has been represented by an attorney of its choice and is fully
aware of the terms contained in this Agreement and AMENDED AND RESTATED RIDER A
to which it is a party which was voluntarily entered into without coercion or
duress of any kind.
12. SoCal represents and warrants to USBPS on behalf of the
Noteholders and Trustee that all necessary actions on the part of SoCal to be
taken in connection with the execution, delivery and performance of this
Agreement have been taken; the performance by SoCal of this Agreement and the
AMENDED AND RESTATED RIDER A will not violate any of SoCal's
6
#2839-002 Articles of Incorporation, Articles of Formation, Partnership
Agreement or other agreement or law by which SoCal is bound.
13. Any notice, request, direction, consent, approval, waiver
or other communication required or permitted under this Agreement to be sent
must be in writing and will become effective only upon delivery to USBPS at the
address set forth herein as follows:
U.S. Bank Portfolio Services
0000 Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxx, XX 00000
Attn: Xxxx Xxx, Director of Operations
14. Except as provided herein, and in the AMENDED AND RESTATED
RIDER A, all of the other provisions of the Loan Documents not restated will
remain in effect.
15. This Agreement and the documents referenced herein
constitute the entire and final agreement among the parties with respect to the
subject matter hereof and there are no agreements, understandings, warranties or
representations among the parties with respect to these matters except as set
forth herein.
16. This Agreement will inure to the benefit of and bind the
parties and their respective successors and permitted assigns.
17. Neither this Agreement nor any of the provisions hereof
can be changed, waived, discharged or terminated except by an instrument in
writing signed by the parties against whom such enforcement of the change,
waiver, discharge or termination is sought.
18. This Agreement will be interpreted and construed under the
laws of the Commonwealth of Pennsylvania, regardless of the domicile of any
party and will be considered to have been made, executed and performed in
Pennsylvania.
7
#2839-002
19. THE UNDERSIGNED, AND SUBJECT TO THE PROVISIONS CONTAINED
HEREIN, USBPS FOR ITSELF AND AS AGENT FOR THE TRUSTEE, (A) AGREE TO SUBMIT FOR
THEMSELVES, IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT AND ANY
SCHEDULE OR FOR RECOGNITION AND ENFORCEMENT OF ANY JUDGMENT IN RESPECT HEREOF OR
THEREOF, TO THE EXCLUSIVE JURISDICTION OF THE COURTS OF THE COMONWEALTH OF
PENNSYLVANIA, THE COURTS OF THE UNITED STATES OF AMERICA FOR THE EASTERN
DISTRICT OF PENNSYLVANIA, AND APPELLATE COURTS FROM ANY THEREOF, (B) CONSENT
THAT ANY ACTION OR PROCEEDING SHALL BE BROUGHT IN SUCH COURTS, AND WAIVE ANY
OBJECTION THAT EACH MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH ACTION OR
PROCEEDING IN ANY SUCH COURT, (C) AGREE THAT SERVICE OF PROCESS OF ANY SUCH
ACTION OR PROCEEDING MAY BE EFFECTED BY CERTIFIED MAIL (OR ANY SUBSTANTIALLY
SIMILAR FORM OF MAIL), POSTAGE PREPAID, TO THE APPROPRIATE PARTY AT ITS ADDRESS
AS SET FORTH HEREIN, AND SERVICE MADE SHALL BE DEEMED TO BE COMPLETED UPON THE
EARLIER OF ACTUAL RECEIPT OR FIVE (5) DAYS AFTER THE SAME SHALL HAVE BEEN POSTED
AS AFORESAID, AND (D) AGREE THAT NOTHING HEREIN OR IN ANY EXHIBIT OR SCHEDULE
SHALL AFFECT THE RIGHT TO EFFECT SERVICE OF PROCESS IN ANY OTHER MANNER
PERMITTED BY LAW. USBPS AND THE UNDERSIGNED EACH HEREBY UNCONDITIONALLY WAIVES
ITS RIGHT TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING
OUT OF, DIRECTLY OR INDIRECTLY, THIS AGREEMENT, ANY EXHIBIT AND THE TRANSACTIONS
8
#2839-002
CONTEMPLATED HEREBY AND THEREBY, ANY OF THE RELATED DOCUMENTS, ANY DEALINGS
BETWEEN THE PARTIES HERETO RELATING TO THE SUBJECT MATTER HEREOF OR THEREOF,
AND/OR THE RELATIONSHIP THAT IS BEING ESTABLISHED BETWEEN USBPS AS AGENT FOR THE
TRUSTEE AND THE UNDERSIGNED, PROVIDED USBPS MAY IN ITS DISCRETION ENFORCE THE
TERMS OF THE FORUM SELECTION PROVISIONS IN THE LOANS.
20. SoCal, the Company and the Guarantor hereby release USBPS,
the Trustee, and the Noteholders from and against any claim, loss, or damage
arising out of the negotiation execution, and performance of the Loan or related
matters prior to the date hereof.
21. This Agreement may be executed in two or more counterparts
and each counterpart shall be deemed an original.
9
#2839-002
LYON FINANCIAL SERVICES, INC. DBA U.S.
BANK PORTFOLIO SERVICES, AS SUCCESSOR
SERVICER FOR DVI RECEIVABLES XVIII, L.L.C.
AND AS AGENT FOR U.S. BANK, N.A., AS TRUSTEE
By:_________________________________________
RADNET MANAGEMENT, INC.
By:_________________________________________
ACKNOWLEDGED AND AGREED TO:
Primedex Health Systems, Inc., Guarantor
By:_____________________________________
10
#1231-050
AMENDMENT TO LOAN DOCUMENTS
---------------------------
AGREEMENT made as of June 30, 2004 ("AMENDMENT AGREEMENT" or
"AGREEMENT") by and between LYON FINANCIAL SERVICES, INC. DBA U.S. BANK
PORTFOLIO SERVICES, as Servicer for DVI Receivables XV, L.L.C. and as Agent for
U.S. Bank, N.A., as Trustee, with offices at 0000 Xxxxxx Xxxxxx, Xxxxx 000,
Xxxxxxxx, Xxxxxxxxx 00000 ("USBPS") and Radnet Management, Inc., a corporation,
with offices at 0000 Xxxxxx Xxxxxx, Xxx Xxxxxxx, XX 00000 ("RADNET"), and such
other signatories hereto.
WHEREAS, on or about Xxxxx 00, 0000, Xxxxxx executed and
delivered to DVI Financial Services Inc. ("DVI") a Loan and Security Agreement
collectively with the Schedule Number #1231-050 dated May 31, 2001 (the "LOAN");
WHEREAS, to secure the payment of the Loan and all other
obligations of Radnet to DVI (collectively the "OBLIGATIONS"), Radnet, pursuant
to a Security Agreement dated on or about December 15, 1997 (the "SECURITY
AGREEMENT"), granted DVI a first priority security interest in certain
Collateral described therein;
WHEREAS, to further secure payment of the Note and all other
Obligations of Radnet to DVI, Radnet delivered to DVI the guarantee (the
"GUARANTEE") of Primedex Health Systems, Inc. (the "GUARANTOR") (the "GUARANTEE"
together with the Loan and ancillary documents are, collectively the "LOAN
DOCUMENTS");
WHEREAS, substantially contemporaneously therewith, DVI
contributed all of the Loan Documents to DVI Receivables XV, L.L.C. ("DVI XV")
and thereafter pursuant to an Amended and Restated Indenture, DVI XV granted a
first priority security interest in and pledged all of the Loan Documents in
favor of U.S. Bank, N.A., as Trustee, for the benefit of a
#1231-050
noteholder which purchased asset backed promissory notes issued by DVI XV (the
"Noteholder");
WHEREAS, DVI contributed other Loans with Radnet or certain
affiliates of Radnet to this and other DVI securitizations (collectively the
"RELATED LOANS");
WHEREAS, Radnet is in default under the terms of the Loan;
WHEREAS, Radnet has requested USBPS to modify the Loan to
reflect an adjustment in payments;
WHEREAS, Radnet and/or certain of its affiliates have agreed
to modify the Related Loans;
WHEREAS, Radnet and certain of its affiliates are engaged in
negotiations to restructure or modify certain loan agreements, loans and
promissory notes with each of General Electric Capital Corporation ("GECC") and
DVI (with respect to GECC, the "GECC MODIFICATION", and with respect to DVI, the
"DVI MODIFICATION");
WHEREAS, subject to the following terms and conditions, USBPS
is willing to modify the Loan as hereinafter provided.
NOW, THEREFORE, the parties agree as follows:
1. All of the Whereas clauses are incorporated herein as if
hereinafter set forth at full length.
2. Radnet acknowledges that it is duly indebted to the Trustee
in the sum set forth on AMENDED AND RESTATED RIDER A annexed hereto, and has no
defenses, counterclaims or offsets to such indebtedness.
3. USBPS as Agent for the Trustee will modify the Loan to
provide for payments to commence in accordance with the attached revised payment
schedule (the
2
#1231-050
"AMENDED AND RESTATED RIDER A"). Radnet may, at any time, prepay all of the then
outstanding Obligations subject to an additional prepayment fee of 2% of such
Obligations. Partial prepayments of the Obligations shall not be permitted at
any time.
4. This Agreement shall become effective upon the date that
USBPS receives this Agreement duly executed by Radnet and the satisfaction of
each of the following conditions:
(a) Radnet and/or its affiliates shall have entered
into agreements on similar terms to this Agreement and
otherwise in form and substance satisfactory to USBPS,
relating to the Related Loans (the "Related Loan
Modifications");
(b) reimbursement of USBPS's legal fees incurred in
connection with the execution of this Agreement and the
Related Loan Modifications, aggregating $50,000, shall have
been received by USBPS;
(c) Radnet and/or its affiliates shall have entered
into the GECC Modification and the DVI Modification.
5. The closing of the restructuring of the Radnet Loan is
further subject to delivery to USBPS of all of the following, each in form and
substance satisfactory to USBPS and its counsel:
(a) The executed AMENDED AND RESTATED RIDER A;
(b) An executed copy of this Agreement;
(c) Such other documents, including UCC financing
statements as USBPS reasonably requests.
6. Radnet hereby acknowledges and agrees that it has no, and
will not assert any, defenses, counterclaims or offsets to the Loan and AMENDED
AND RESTATED RIDER A and acknowledges and agrees that the Trustee holds a
first-priority security interest in the Collateral.
7. Any default or other breach of any obligation under the
GECC Modification, the DVI Modification, or any of the Related Loan
Modifications shall constitute a
3
#1231-050
default under the Loan as modified by this Agreement, and USBPS shall have all
remedies thereunder.
8. Radnet hereby releases the Noteholder, USBPS individually
and as agent for the Trustee and the special purpose entities for which the
Trustee holds collateral, from and against any claims, loss or damage of any
kind or nature arising out of the Loan.
9. So long as any of the Obligations remain outstanding,
Radnet Management, Inc. (the "COMPANY") agrees as follows:
(i) FINANCIAL REPORTING. The Company shall furnish
the following documents or information to USBPS:
(A) Within 30 days after the end of each
Fiscal Quarter (as defined below) (i) (or 90 days in respect of the last month
of the fiscal year), the Company's consolidated, consolidating and on a center
by center basis, financial statements, including the most recent annual report,
balance sheet (not on a center by center basis) and income statement, prepared
in accordance with generally accepted accounting principles, which reports, the
Company warrants, shall fully and fairly represent the true financial condition
of the Company and (ii) updated projections for the Company and for each center;
(B) any other financial information normally
provided by the Company to the public; and
(C) Such other financial data or information
relative to this Amendment Agreement, including, without limitation, listings of
serial numbers or other identification data and confirmations of such
information, as USBPS may time-to-time reasonably request.
(ii) NO AMENDMENTS. Subsequent to the date of this
Amendment Agreement, the Company will not agree or consent to any amendments or
modifications to any agreement between the Company and DVI, GECC or Xxxxx Fargo
Foothill, Inc. ("FOOTHILL") containing terms (including, but not limited to,
increasing interest rates, accelerating the principal amortization or maturity,
new or more stringent defaults, additional collateral, and new remedies
provisions) that would be more onerous to the Company, or adversely impact or
affect GECC with respect to the terms of this Amendment Agreement.
(iii) DISTRIBUTIONS. The Company shall not make any
distribution or declare or pay any dividends (in cash or other property, other
than common stock) on, or purchase, acquire, redeem, or retire any of the
Company's stock, of any class, whether now or hereafter outstanding
(collectively, "DISTRIBUTIONS"); PROVIDED, HOWEVER, that so long as no
4
#1231-050
default shall have occurred and be continuing immediately prior to or after
giving effect to any such payment, (a) the Company may make Distributions to
Primedex Health Systems, Inc., a New York corporation (the "PARENT") (1) in
amounts necessary to pay customary expenses of Parent in the ordinary course of
its business as a public holding company (including salaries and related
reasonable and customary expenses incurred by employees of Parent) in an
aggregate amount not to exceed $750,000 in any fiscal year, (2) in amounts
necessary to enable Parent to pay taxes when due and owing by it in the ordinary
course of its business as a holding company and (3) in amounts necessary to
enable Parent to pay interest on those certain 11.5% Series A Convertible
Subordinated Notes due June 30, 2008, issued by Parent on June 25, 1993, and (b)
Parent may make Distributions in the form of common stock.
(iv) FIXED CHARGE COVERAGE RATIO. Commencing April
30, 2005, the Company shall not permit the Fixed Charge Coverage Ratio, (a) to
be less than 1.0:1 as of the end of each April, July, October and January (each,
a "FISCAL QUARTER") ending prior to January 1, 2007, and (b) to be less than
1.05:1 as of the last day of each Fiscal Quarter ending thereafter. "FIXED
CHARGE COVERAGE RATIO" means for any period, the ratio of (i) EBITDA for such
period minus cash capital expenditures made (to the extent not already incurred
in a prior period) or incurred during such period, to (ii) the sum of (a)
interest expense, (b) principal payments required to be paid during such period
in respect of indebtedness, and (c) all federal, state, and local income taxes
accrued, all as determined for the twelve months ending on the determination
date for the Company and its subsidiaries on a consolidated basis without
duplication and in accordance with generally accepted accounting principles
consistently applied. "EBITDA" means, with respect to any fiscal period, the
Company's and its subsidiaries' consolidated net earnings (or loss), minus
extraordinary gains and interest income, plus interest expense, income taxes,
and depreciation and amortization for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(v) LEVERAGE RATIO. The Company shall not permit the
Leverage Ratio, as determined as of the end of each Fiscal Quarter, to be
greater than the amount set forth in the following table for the Fiscal Quarters
ending in the period set forth opposite thereto:
LEVERAGE RATIO PERIOD
-------------- ------
4.50:1.0 04/30/05 - 10/30/05
4.30:1.0 10/31/05 - 10/30/06
4.00:1.0 10/31/06 - 10/30/07
3.80:1.0 10/31/07 - 10/30/08
"LEVERAGE RATIO" means, at any date of determination, the
ratio of (a) Total Debt at such date to (b) EBITDA for the applicable period
ending on such date. "TOTAL DEBT" means, as of any date of determination,
without duplication, the sum of (a) the outstanding aggregate amount of the
obligations for borrowed money, (b) the outstanding principal amount of capital
leases, (c) the outstanding principal amount of purchase money indebtedness, (d)
the outstanding principal amount of funded debt, and (e) the outstanding
principal amount of all obligations
5
#1231-050
owing to GECC, DVI and USBPS; all as determined for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(vi) EBITDA MARGIN. The Company shall not permit the
EBITDA Margin to be less than 25% as of the end of any Fiscal Quarter ending on
or after April 30, 2005. "EBITDA MARGIN" means for any period, the ratio of (a)
EBITDA for such period, to (b) net revenues (excluding the professional service
fee component of radiology services) for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(vii) RECEIVABLE DAYS. The Company shall not permit
the Receivable Days to exceed 65 days as of the end of any Fiscal Quarter ending
on or after April 30, 2005. "RECEIVABLE DAYS" means for any period, a number
equal to (a) 365 divided by (b) the result of (i) net revenues for such period
divided by (ii) net receivables for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(viii) NAME CHANGES, ETC. The Company agrees that it
shall not change its name or jurisdiction of organization without giving 30 days
prior written notice to USBPS.
10. To induce USBPS on behalf of the Trustee to enter this
Agreement, the Guarantor hereby affirms and restates its Guarantee as related to
this Loan and AMENDED AND RESTATED RIDER A.
11. Radnet, the Company and the Guarantor each represent and
warrant that each has been represented by an attorney of its choice and is fully
aware of the terms contained in this Agreement and AMENDED AND RESTATED RIDER A
to which it is a party which was voluntarily entered into without coercion or
duress of any kind.
12. Radnet represents and warrants to USBPS on behalf of the
Noteholders and Trustee that all necessary actions on the part of Radnet to be
taken in connection with the execution, delivery and performance of this
Agreement have been taken; the performance by Radnet of this Agreement and the
AMENDED AND RESTATED RIDER A will not violate any of
6
#1231-050
Radnet's Articles of Incorporation, Articles of Formation, Partnership Agreement
or other agreement or law by which Radnet is bound.
13. Any notice, request, direction, consent, approval, waiver
or other communication required or permitted under this Agreement to be sent
must be in writing and will become effective only upon delivery to USBPS at the
address set forth herein as follows:
U.S. Bank Portfolio Services
0000 Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxx, XX 00000
Attn: Xxxx Xxx, Director of Operations
14. Except as provided herein, and in the AMENDED AND RESTATED
RIDER A, all of the other provisions of the Loan Documents not restated will
remain in effect.
15. This Agreement and the documents referenced herein
constitute the entire and final agreement among the parties with respect to the
subject matter hereof and there are no agreements, understandings, warranties or
representations among the parties with respect to these matters except as set
forth herein.
16. This Agreement will inure to the benefit of and bind the
parties and their respective successors and permitted assigns.
17. Neither this Agreement nor any of the provisions hereof
can be changed, waived, discharged or terminated except by an instrument in
writing signed by the parties against whom such enforcement of the change,
waiver, discharge or termination is sought.
18. This Agreement will be interpreted and construed under the
laws of the Commonwealth of Pennsylvania, regardless of the domicile of any
party and will be considered to have been made, executed and performed in
Pennsylvania.
7
#1231-050
19. THE UNDERSIGNED, AND SUBJECT TO THE PROVISIONS CONTAINED
HEREIN, USBPS FOR ITSELF AND AS AGENT FOR THE TRUSTEE, (A) AGREE TO SUBMIT FOR
THEMSELVES, IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT AND ANY
SCHEDULE OR FOR RECOGNITION AND ENFORCEMENT OF ANY JUDGMENT IN RESPECT HEREOF OR
THEREOF, TO THE EXCLUSIVE JURISDICTION OF THE COURTS OF THE COMONWEALTH OF
PENNSYLVANIA, THE COURTS OF THE UNITED STATES OF AMERICA FOR THE EASTERN
DISTRICT OF PENNSYLVANIA, AND APPELLATE COURTS FROM ANY THEREOF, (B) CONSENT
THAT ANY ACTION OR PROCEEDING SHALL BE BROUGHT IN SUCH COURTS, AND WAIVE ANY
OBJECTION THAT EACH MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH ACTION OR
PROCEEDING IN ANY SUCH COURT, (C) AGREE THAT SERVICE OF PROCESS OF ANY SUCH
ACTION OR PROCEEDING MAY BE EFFECTED BY CERTIFIED MAIL (OR ANY SUBSTANTIALLY
SIMILAR FORM OF MAIL), POSTAGE PREPAID, TO THE APPROPRIATE PARTY AT ITS ADDRESS
AS SET FORTH HEREIN, AND SERVICE MADE SHALL BE DEEMED TO BE COMPLETED UPON THE
EARLIER OF ACTUAL RECEIPT OR FIVE (5) DAYS AFTER THE SAME SHALL HAVE BEEN POSTED
AS AFORESAID, AND (D) AGREE THAT NOTHING HEREIN OR IN ANY EXHIBIT OR SCHEDULE
SHALL AFFECT THE RIGHT TO EFFECT SERVICE OF PROCESS IN ANY OTHER MANNER
PERMITTED BY LAW. USBPS AND THE UNDERSIGNED EACH HEREBY UNCONDITIONALLY WAIVES
ITS RIGHT TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING
OUT OF, DIRECTLY OR INDIRECTLY, THIS AGREEMENT, ANY EXHIBIT AND THE TRANSACTIONS
8
#1231-050
CONTEMPLATED HEREBY AND THEREBY, ANY OF THE RELATED DOCUMENTS, ANY DEALINGS
BETWEEN THE PARTIES HERETO RELATING TO THE SUBJECT MATTER HEREOF OR THEREOF,
AND/OR THE RELATIONSHIP THAT IS BEING ESTABLISHED BETWEEN USBPS AS AGENT FOR THE
TRUSTEE AND THE UNDERSIGNED, PROVIDED USBPS MAY IN ITS DISCRETION ENFORCE THE
TERMS OF THE FORUM SELECTION PROVISIONS IN THE LOANS.
20. Radnet, the Company and the Guarantor hereby release
USBPS, the Trustee, and the Noteholders from and against any claim, loss, or
damage arising out of the negotiation execution, and performance of the Loan or
related matters prior to the date hereof.
21. This Agreement may be executed in two or more counterparts
and each counterpart shall be deemed an original.
9
#1231-050
LYON FINANCIAL SERVICES, INC. DBA U.S.
BANK PORTFOLIO SERVICES, AS SERVICER
FOR DVI RECEIVABLES XV, L.L.C. AND AS AGENT
FOR U.S. BANK, N.A., AS TRUSTEE
By:_________________________________________
RADNET MANAGEMENT, INC.
By:_________________________________________
ACKNOWLEDGED AND AGREED TO:
Primedex Health Systems, Inc., Guarantor
By:_____________________________________
10
#1231-049
AMENDMENT TO LOAN DOCUMENTS
---------------------------
AGREEMENT made as of June 30, 2004 ("AMENDMENT AGREEMENT" or
"AGREEMENT") by and between LYON FINANCIAL SERVICES, INC. DBA U.S. BANK
PORTFOLIO SERVICES, as Servicer for DVI Receivables XV, L.L.C. and as Agent for
U.S. Bank, N.A., as Trustee, with offices at 0000 Xxxxxx Xxxxxx, Xxxxx 000,
Xxxxxxxx, Xxxxxxxxx 00000 ("USBPS") and Radnet Management, Inc., a corporation,
with offices at 0000 Xxxxxx Xxxxxx, Xxx Xxxxxxx, XX 00000 ("RADNET"), and such
other signatories hereto.
WHEREAS, on or about Xxxxx 00, 0000, Xxxxxx executed and
delivered to DVI Financial Services Inc. ("DVI") a Loan and Security Agreement
collectively with the Schedule Number #1231-049 dated April 25, 2001 (the
"LOAN");
WHEREAS, to secure the payment of the Loan and all other
obligations of Radnet to DVI (collectively the "OBLIGATIONS"), Radnet, pursuant
to a Security Agreement dated on or about December 15, 1997 (the "SECURITY
AGREEMENT"), granted DVI a first priority security interest in certain
Collateral described therein;
WHEREAS, to further secure payment of the Note and all other
Obligations of Radnet to DVI, Radnet delivered to DVI the guarantee (the
"GUARANTEE") of Primedex Health Systems, Inc. (the "GUARANTOR") (the "GUARANTEE"
together with the Loan and ancillary documents are, collectively the "LOAN
DOCUMENTS");
WHEREAS, substantially contemporaneously therewith, DVI
contributed all of the Loan Documents to DVI Receivables XV, L.L.C. ("DVI XV")
and thereafter pursuant to an Amended and Restated Indenture, DVI XV granted a
first priority security interest in and pledged all of the Loan Documents in
favor of U.S. Bank, N.A., as Trustee, for the benefit of a
#1231-049
noteholder which purchased asset backed promissory notes issued by DVI XV (the
"Noteholder");
WHEREAS, DVI contributed other Loans with Radnet or certain
affiliates of Radnet to this and other DVI securitizations (collectively the
"RELATED LOANS");
WHEREAS, Radnet is in default under the terms of the Loan;
WHEREAS, Radnet has requested USBPS to modify the Loan to
reflect an adjustment in payments;
WHEREAS, Radnet and/or certain of its affiliates have agreed
to modify the Related Loans;
WHEREAS, Radnet and certain of its affiliates are engaged in
negotiations to restructure or modify certain loan agreements, loans and
promissory notes with each of General Electric Capital Corporation ("GECC") and
DVI (with respect to GECC, the "GECC MODIFICATION", and with respect to DVI, the
"DVI MODIFICATION");
WHEREAS, subject to the following terms and conditions, USBPS
is willing to modify the Loan as hereinafter provided.
NOW, THEREFORE, the parties agree as follows:
1. All of the Whereas clauses are incorporated herein as if
hereinafter set forth at full length.
2. Radnet acknowledges that it is duly indebted to the Trustee
in the sum set forth on AMENDED AND RESTATED RIDER A annexed hereto, and has no
defenses, counterclaims or offsets to such indebtedness.
3. USBPS as Agent for the Trustee will modify the Loan to
provide for payments to commence in accordance with the attached revised payment
schedule (the
2
#1231-049
"AMENDED AND RESTATED RIDER A"). Radnet may, at any time, prepay all of the then
outstanding Obligations subject to an additional prepayment fee of 2% of such
Obligations. Partial prepayments of the Obligations shall not be permitted at
any time.
4. This Agreement shall become effective upon the date that
USBPS receives this Agreement duly executed by Radnet and the satisfaction of
each of the following conditions:
(a) Radnet and/or its affiliates shall have entered
into agreements on similar terms to this Agreement and
otherwise in form and substance satisfactory to USBPS,
relating to the Related Loans (the "Related Loan
Modifications");
(b) reimbursement of USBPS's legal fees incurred in
connection with the execution of this Agreement and the
Related Loan Modifications, aggregating $50,000, shall have
been received by USBPS;
(c) Radnet and/or its affiliates shall have entered
into the GECC Modification and the DVI Modification.
5. The closing of the restructuring of the Radnet Loan is
further subject to delivery to USBPS of all of the following, each in form and
substance satisfactory to USBPS and its counsel:
(a) The executed AMENDED AND RESTATED RIDER A;
(b) An executed copy of this Agreement;
(c) Such other documents, including UCC financing
statements as USBPS reasonably requests.
6. Radnet hereby acknowledges and agrees that it has no, and
will not assert any, defenses, counterclaims or offsets to the Loan and AMENDED
AND RESTATED RIDER A and acknowledges and agrees that the Trustee holds a
first-priority security interest in the Collateral.
7. Any default or other breach of any obligation under the
GECC Modification, the DVI Modification, or any of the Related Loan
Modifications shall constitute a
3
#1231-049
default under the Loan as modified by this Agreement, and USBPS shall have all
remedies thereunder.
8. Radnet hereby releases the Noteholder, USBPS individually
and as agent for the Trustee and the special purpose entities for which the
Trustee holds collateral, from and against any claims, loss or damage of any
kind or nature arising out of the Loan.
9. So long as any of the Obligations remain outstanding,
Radnet Management, Inc. (the "COMPANY") agrees as follows:
(i) FINANCIAL REPORTING. The Company shall furnish
the following documents or information to USBPS:
(A) Within 30 days after the end of each
Fiscal Quarter (as defined below) (i) (or 90 days in respect of the last month
of the fiscal year), the Company's consolidated, consolidating and on a center
by center basis, financial statements, including the most recent annual report,
balance sheet (not on a center by center basis) and income statement, prepared
in accordance with generally accepted accounting principles, which reports, the
Company warrants, shall fully and fairly represent the true financial condition
of the Company and (ii) updated projections for the Company and for each center;
(B) any other financial information normally
provided by the Company to the public; and
(C) Such other financial data or information
relative to this Amendment Agreement, including, without limitation, listings of
serial numbers or other identification data and confirmations of such
information, as USBPS may time-to-time reasonably request.
(ii) NO AMENDMENTS. Subsequent to the date of this
Amendment Agreement, the Company will not agree or consent to any amendments or
modifications to any agreement between the Company and DVI, GECC or Xxxxx Fargo
Foothill, Inc. ("FOOTHILL") containing terms (including, but not limited to,
increasing interest rates, accelerating the principal amortization or maturity,
new or more stringent defaults, additional collateral, and new remedies
provisions) that would be more onerous to the Company, or adversely impact or
affect GECC with respect to the terms of this Amendment Agreement.
(iii) DISTRIBUTIONS. The Company shall not make any
distribution or declare or pay any dividends (in cash or other property, other
than common stock) on, or purchase, acquire, redeem, or retire any of the
Company's stock, of any class, whether now or hereafter outstanding
(collectively, "DISTRIBUTIONS"); PROVIDED, HOWEVER, that so long as no
4
#1231-049
default shall have occurred and be continuing immediately prior to or after
giving effect to any such payment, (a) the Company may make Distributions to
Primedex Health Systems, Inc., a New York corporation (the "PARENT") (1) in
amounts necessary to pay customary expenses of Parent in the ordinary course of
its business as a public holding company (including salaries and related
reasonable and customary expenses incurred by employees of Parent) in an
aggregate amount not to exceed $750,000 in any fiscal year, (2) in amounts
necessary to enable Parent to pay taxes when due and owing by it in the ordinary
course of its business as a holding company and (3) in amounts necessary to
enable Parent to pay interest on those certain 11.5% Series A Convertible
Subordinated Notes due June 30, 2008, issued by Parent on June 25, 1993, and (b)
Parent may make Distributions in the form of common stock.
(iv) FIXED CHARGE COVERAGE RATIO. Commencing April
30, 2005, the Company shall not permit the Fixed Charge Coverage Ratio, (a) to
be less than 1.0:1 as of the end of each April, July, October and January (each,
a "FISCAL QUARTER") ending prior to January 1, 2007, and (b) to be less than
1.05:1 as of the last day of each Fiscal Quarter ending thereafter. "FIXED
CHARGE COVERAGE RATIO" means for any period, the ratio of (i) EBITDA for such
period MINUS cash capital expenditures made (to the extent not already incurred
in a prior period) or incurred during such period, to (ii) the sum of (a)
interest expense, (b) principal payments required to be paid during such period
in respect of indebtedness, and (c) all federal, state, and local income taxes
accrued, all as determined for the twelve months ending on the determination
date for the Company and its subsidiaries on a consolidated basis without
duplication and in accordance with generally accepted accounting principles
consistently applied. "EBITDA" means, with respect to any fiscal period, the
Company's and its subsidiaries' consolidated net earnings (or loss), minus
extraordinary gains and interest income, plus interest expense, income taxes,
and depreciation and amortization for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(v) LEVERAGE RATIO. The Company shall not permit the
Leverage Ratio, as determined as of the end of each Fiscal Quarter, to be
greater than the amount set forth in the following table for the Fiscal Quarters
ending in the period set forth opposite thereto:
LEVERAGE RATIO PERIODRu
-------------- --------
4.50:1.0 04/30/05 - 10/30/05
4.30:1.0 10/31/05 - 10/30/06
4.00:1.0 10/31/06 - 10/30/07
3.80:1.0 10/31/07 - 10/30/08
"LEVERAGE RATIO" means, at any date of determination, the
ratio of (a) Total Debt at such date to (b) EBITDA for the applicable period
ending on such date. "TOTAL DEBT" means, as of any date of determination,
without duplication, the sum of (a) the outstanding aggregate amount of the
obligations for borrowed money, (b) the outstanding principal amount of capital
leases, (c) the outstanding principal amount of purchase money indebtedness, (d)
the outstanding principal amount of funded debt, and (e) the outstanding
principal amount of all obligations
5
#1231-049
owing to GECC, DVI and USBPS; all as determined for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(vi) EBITDA MARGIN. The Company shall not permit the
EBITDA Margin to be less than 25% as of the end of any Fiscal Quarter ending on
or after April 30, 2005. "EBITDA MARGIN" means for any period, the ratio of (a)
EBITDA for such period, to (b) net revenues (excluding the professional service
fee component of radiology services) for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(vii) RECEIVABLE DAYS. The Company shall not permit
the Receivable Days to exceed 65 days as of the end of any Fiscal Quarter ending
on or after April 30, 2005. "RECEIVABLE DAYS" means for any period, a number
equal to (a) 365 divided by (b) the result of (i) net revenues for such period
divided by (ii) net receivables for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(viii) NAME CHANGES, ETC. The Company agrees that it
shall not change its name or jurisdiction of organization without giving 30 days
prior written notice to USBPS.
10. To induce USBPS on behalf of the Trustee to enter this
Agreement, the Guarantor hereby affirms and restates its Guarantee as related to
this Loan and AMENDED AND RESTATED RIDER A.
11. Radnet, the Company and the Guarantor each represent and
warrant that each has been represented by an attorney of its choice and is fully
aware of the terms contained in this Agreement and AMENDED AND RESTATED RIDER A
to which it is a party which was voluntarily entered into without coercion or
duress of any kind.
12. Radnet represents and warrants to USBPS on behalf of the
Noteholders and Trustee that all necessary actions on the part of Radnet to be
taken in connection with the execution, delivery and performance of this
Agreement have been taken; the performance by Radnet of this Agreement and the
AMENDED AND RESTATED RIDER A will not violate any of
6
#1231-049
Radnet's Articles of Incorporation, Articles of Formation, Partnership Agreement
or other agreement or law by which Radnet is bound.
13. Any notice, request, direction, consent, approval, waiver
or other communication required or permitted under this Agreement to be sent
must be in writing and will become effective only upon delivery to USBPS at the
address set forth herein as follows:
U.S. Bank Portfolio Services
0000 Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxx, XX 00000
Attn: Xxxx Xxx, Director of Operations
14. Except as provided herein, and in the AMENDED AND RESTATED
RIDER A, all of the other provisions of the Loan Documents not restated will
remain in effect.
15. This Agreement and the documents referenced herein
constitute the entire and final agreement among the parties with respect to the
subject matter hereof and there are no agreements, understandings, warranties or
representations among the parties with respect to these matters except as set
forth herein.
16. This Agreement will inure to the benefit of and bind the
parties and their respective successors and permitted assigns.
17. Neither this Agreement nor any of the provisions hereof
can be changed, waived, discharged or terminated except by an instrument in
writing signed by the parties against whom such enforcement of the change,
waiver, discharge or termination is sought.
18. This Agreement will be interpreted and construed under the
laws of the Commonwealth of Pennsylvania, regardless of the domicile of any
party and will be considered to have been made, executed and performed in
Pennsylvania.
7
#1231-049
19. THE UNDERSIGNED, AND SUBJECT TO THE PROVISIONS CONTAINED
HEREIN, USBPS FOR ITSELF AND AS AGENT FOR THE TRUSTEE, (A) AGREE TO SUBMIT FOR
THEMSELVES, IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT AND ANY
SCHEDULE OR FOR RECOGNITION AND ENFORCEMENT OF ANY JUDGMENT IN RESPECT HEREOF OR
THEREOF, TO THE EXCLUSIVE JURISDICTION OF THE COURTS OF THE COMONWEALTH OF
PENNSYLVANIA, THE COURTS OF THE UNITED STATES OF AMERICA FOR THE EASTERN
DISTRICT OF PENNSYLVANIA, AND APPELLATE COURTS FROM ANY THEREOF, (B) CONSENT
THAT ANY ACTION OR PROCEEDING SHALL BE BROUGHT IN SUCH COURTS, AND WAIVE ANY
OBJECTION THAT EACH MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH ACTION OR
PROCEEDING IN ANY SUCH COURT, (C) AGREE THAT SERVICE OF PROCESS OF ANY SUCH
ACTION OR PROCEEDING MAY BE EFFECTED BY CERTIFIED MAIL (OR ANY SUBSTANTIALLY
SIMILAR FORM OF MAIL), POSTAGE PREPAID, TO THE APPROPRIATE PARTY AT ITS ADDRESS
AS SET FORTH HEREIN, AND SERVICE MADE SHALL BE DEEMED TO BE COMPLETED UPON THE
EARLIER OF ACTUAL RECEIPT OR FIVE (5) DAYS AFTER THE SAME SHALL HAVE BEEN POSTED
AS AFORESAID, AND (D) AGREE THAT NOTHING HEREIN OR IN ANY EXHIBIT OR SCHEDULE
SHALL AFFECT THE RIGHT TO EFFECT SERVICE OF PROCESS IN ANY OTHER MANNER
PERMITTED BY LAW. USBPS AND THE UNDERSIGNED EACH HEREBY UNCONDITIONALLY WAIVES
ITS RIGHT TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING
OUT OF, DIRECTLY OR INDIRECTLY, THIS AGREEMENT, ANY EXHIBIT AND THE TRANSACTIONS
8
#1231-049
CONTEMPLATED HEREBY AND THEREBY, ANY OF THE RELATED DOCUMENTS, ANY DEALINGS
BETWEEN THE PARTIES HERETO RELATING TO THE SUBJECT MATTER HEREOF OR THEREOF,
AND/OR THE RELATIONSHIP THAT IS BEING ESTABLISHED BETWEEN USBPS AS AGENT FOR THE
TRUSTEE AND THE UNDERSIGNED, PROVIDED USBPS MAY IN ITS DISCRETION ENFORCE THE
TERMS OF THE FORUM SELECTION PROVISIONS IN THE LOANS.
20. Radnet, the Company and the Guarantor hereby release
USBPS, the Trustee, and the Noteholders from and against any claim, loss, or
damage arising out of the negotiation execution, and performance of the Loan or
related matters prior to the date hereof.
21. This Agreement may be executed in two or more counterparts
and each counterpart shall be deemed an original.
9
#1231-049
LYON FINANCIAL SERVICES, INC. DBA U.S.
BANK PORTFOLIO SERVICES, AS SERVICER
FOR DVI RECEIVABLES XV, L.L.C.
AND AS AGENT FOR U.S. BANK, N.A., AS TRUSTEE
By: ________________________________________
RADNET MANAGEMENT, INC.
By: ________________________________________
ACKNOWLEDGED AND AGREED TO:
Primedex Health Systems, Inc., Guarantor
By: ____________________________________
10
#1231-048
AMENDMENT TO LOAN DOCUMENTS
---------------------------
AGREEMENT made as of June 30, 2004 ("AMENDMENT AGREEMENT" or
"AGREEMENT") by and between LYON FINANCIAL SERVICES, INC. DBA U.S. BANK
PORTFOLIO SERVICES, as Successor Servicer for DVI Receivables XIX, L.L.C. and as
Agent for U.S. Bank, N.A., as Trustee, with offices at 0000 Xxxxxx Xxxxxx, Xxxxx
000, Xxxxxxxx, Xxxxxxxxx 00000 ("USBPS") and Radnet Management, Inc., a
corporation, with offices at 0000 Xxxxxx Xxxxxx, Xxx Xxxxxxx, XX 00000
("RADNET"), and such other signatories hereto.
WHEREAS, on or about Xxxxx 00, 0000, Xxxxxx executed and
delivered to DVI Financial Services Inc. ("DVI") a Loan and Security Agreement
collectively with the Schedule Number #1231-048 dated April 25, 2001 (the
"LOAN");
WHEREAS, to secure the payment of the Loan and all other
obligations of Radnet to DVI (collectively the "OBLIGATIONS"), Radnet, pursuant
to a Security Agreement dated on or about December 15, 1997 (the "SECURITY
AGREEMENT"), granted DVI a first priority security interest in certain
Collateral described therein;
WHEREAS, to further secure payment of the Note and all other
Obligations of Radnet to DVI, Radnet delivered to DVI the guarantee (the
"GUARANTEE") of Primedex Health Systems, Inc. (the "GUARANTOR") (the "GUARANTEE"
together with the Loan and ancillary documents are, collectively the "LOAN
DOCUMENTS");
WHEREAS, substantially contemporaneously therewith, DVI
contributed all of the Loan Documents to DVI Receivables XIX, L.L.C. ("DVI XIX")
and thereafter pursuant to an Amended and Restated Indenture, DVI XIX granted a
first priority security interest in and pledged all of the Loan Documents in
favor of U.S. Bank, N.A., as Trustee, for the benefit of a
#1231-048
noteholder which purchased asset backed promissory notes issued by DVI XIX (the
"Noteholder");
WHEREAS, DVI contributed other Loans with Radnet or certain
affiliates of Radnet to this and other DVI securitizations (collectively the
"RELATED LOANS");
WHEREAS, Radnet is in default under the terms of the Loan;
WHEREAS, Radnet has requested USBPS to modify the Loan to
reflect an adjustment in payments;
WHEREAS, Radnet and/or certain of its affiliates have agreed
to modify the Related Loans;
WHEREAS, Radnet and certain of its affiliates are engaged in
negotiations to restructure or modify certain loan agreements, loans and
promissory notes with each of General Electric Capital Corporation ("GECC") and
DVI (with respect to GECC, the "GECC MODIFICATION", and with respect to DVI, the
"DVI MODIFICATION");
WHEREAS, subject to the following terms and conditions, USBPS
is willing to modify the Loan as hereinafter provided.
NOW, THEREFORE, the parties agree as follows:
1. All of the Whereas clauses are incorporated herein as if
hereinafter set forth at full length.
2. Radnet acknowledges that it is duly indebted to the Trustee
in the sum set forth on AMENDED AND RESTATED RIDER A annexed hereto, and has no
defenses, counterclaims or offsets to such indebtedness.
3. USBPS as Agent for the Trustee will modify the Loan to
provide for payments to commence in accordance with the attached revised payment
schedule (the
2
#1231-048
"AMENDED AND RESTATED RIDER A"). Radnet may, at any time, prepay all of the then
outstanding Obligations subject to an additional prepayment fee of 2% of such
Obligations. Partial prepayments of the Obligations shall not be permitted at
any time.
4. This Agreement shall become effective upon the date that
USBPS receives this Agreement duly executed by Radnet and the satisfaction of
each of the following conditions:
(a) Radnet and/or its affiliates shall have entered
into agreements on similar terms to this Agreement and
otherwise in form and substance satisfactory to USBPS,
relating to the Related Loans (the "Related Loan
Modifications");
(b) reimbursement of USBPS's legal fees incurred in
connection with the execution of this Agreement and the
Related Loan Modifications, aggregating $50,000, shall have
been received by USBPS;
(c) Radnet and/or its affiliates shall have entered
into the GECC Modification and the DVI Modification.
5. The closing of the restructuring of the Radnet Loan is
further subject to delivery to USBPS of all of the following, each in form and
substance satisfactory to USBPS and its counsel:
(a) The executed AMENDED AND RESTATED RIDER A;
(b) An executed copy of this Agreement;
(c) Such other documents, including UCC financing
statements as USBPS reasonably requests.
6. Radnet hereby acknowledges and agrees that it has no, and
will not assert any, defenses, counterclaims or offsets to the Loan and AMENDED
AND RESTATED RIDER A and acknowledges and agrees that the Trustee holds a
first-priority security interest in the Collateral.
7. Any default or other breach of any obligation under the
GECC Modification, the DVI Modification, or any of the Related Loan
Modifications shall constitute a
3
#1231-048
default under the Loan as modified by this Agreement, and USBPS shall have all
remedies thereunder.
8. Radnet hereby releases the Noteholder, USBPS individually
and as agent for the Trustee and the special purpose entities for which the
Trustee holds collateral, from and against any claims, loss or damage of any
kind or nature arising out of the Loan.
9. So long as any of the Obligations remain outstanding,
Radnet Management, Inc. (the "COMPANY") agrees as follows:
(i) FINANCIAL REPORTING. The Company shall furnish
the following documents or information to USBPS:
(A) Within 30 days after the end of each
Fiscal Quarter (as defined below) (i) (or 90 days in respect of the last month
of the fiscal year), the Company's consolidated, consolidating and on a center
by center basis, financial statements, including the most recent annual report,
balance sheet (not on a center by center basis) and income statement, prepared
in accordance with generally accepted accounting principles, which reports, the
Company warrants, shall fully and fairly represent the true financial condition
of the Company and (ii) updated projections for the Company and for each center;
(B) any other financial information normally
provided by the Company to the public; and
(C) Such other financial data or information
relative to this Amendment Agreement, including, without limitation, listings of
serial numbers or other identification data and confirmations of such
information, as USBPS may time-to-time reasonably request.
(ii) NO AMENDMENTS. Subsequent to the date of this
Amendment Agreement, the Company will not agree or consent to any amendments or
modifications to any agreement between the Company and DVI, GECC or Xxxxx Fargo
Foothill, Inc. ("FOOTHILL") containing terms (including, but not limited to,
increasing interest rates, accelerating the principal amortization or maturity,
new or more stringent defaults, additional collateral, and new remedies
provisions) that would be more onerous to the Company, or adversely impact or
affect GECC with respect to the terms of this Amendment Agreement.
(iii) DISTRIBUTIONS. The Company shall not make any
distribution or declare or pay any dividends (in cash or other property, other
than common stock) on, or purchase, acquire, redeem, or retire any of the
Company's stock, of any class, whether now or hereafter outstanding
(collectively, "DISTRIBUTIONS"); PROVIDED, HOWEVER, that so long as no
4
#1231-048
default shall have occurred and be continuing immediately prior to or after
giving effect to any such payment, (a) the Company may make Distributions to
Primedex Health Systems, Inc., a New York corporation (the "PARENT") (1) in
amounts necessary to pay customary expenses of Parent in the ordinary course of
its business as a public holding company (including salaries and related
reasonable and customary expenses incurred by employees of Parent) in an
aggregate amount not to exceed $750,000 in any fiscal year, (2) in amounts
necessary to enable Parent to pay taxes when due and owing by it in the ordinary
course of its business as a holding company and (3) in amounts necessary to
enable Parent to pay interest on those certain 11.5% Series A Convertible
Subordinated Notes due June 30, 2008, issued by Parent on June 25, 1993, and (b)
Parent may make Distributions in the form of common stock.
(iv) FIXED CHARGE COVERAGE RATIO. Commencing April
30, 2005, the Company shall not permit the Fixed Charge Coverage Ratio, (a) to
be less than 1.0:1 as of the end of each April, July, October and January (each,
a "FISCAL QUARTER") ending prior to January 1, 2007, and (b) to be less than
1.05:1 as of the last day of each Fiscal Quarter ending thereafter. "FIXED
CHARGE COVERAGE RATIO" means for any period, the ratio of (i) EBITDA for such
period minus cash capital expenditures made (to the extent not already incurred
in a prior period) or incurred during such period, to (ii) the sum of (a)
interest expense, (b) principal payments required to be paid during such period
in respect of indebtedness, and (c) all federal, state, and local income taxes
accrued, all as determined for the twelve months ending on the determination
date for the Company and its subsidiaries on a consolidated basis without
duplication and in accordance with generally accepted accounting principles
consistently applied. "EBITDA" means, with respect to any fiscal period, the
Company's and its subsidiaries' consolidated net earnings (or loss), minus
extraordinary gains and interest income, plus interest expense, income taxes,
and depreciation and amortization for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(v) LEVERAGE RATIO. The Company shall not permit the
Leverage Ratio, as determined as of the end of each Fiscal Quarter, to be
greater than the amount set forth in the following table for the Fiscal Quarters
ending in the period set forth opposite thereto:
LEVERAGE RATIO PERIOD
-------------- ------
4.50:1.0 04/30/05 - 10/30/05
4.30:1.0 10/31/05 - 10/30/06
4.00:1.0 10/31/06 - 10/30/07
3.80:1.0 10/31/07 - 10/30/08
"LEVERAGE RATIO" means, at any date of determination, the
ratio of (a) Total Debt at such date to (b) EBITDA for the applicable period
ending on such date. "TOTAL DEBT" means, as of any date of determination,
without duplication, the sum of (a) the outstanding aggregate amount of the
obligations for borrowed money, (b) the outstanding principal amount of capital
leases, (c) the outstanding principal amount of purchase money indebtedness, (d)
the outstanding principal amount of funded debt, and (e) the outstanding
principal amount of all obligations
5
#1231-048
owing to GECC, DVI and USBPS; all as determined for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(vi) EBITDA MARGIN. The Company shall not permit the
EBITDA Margin to be less than 25% as of the end of any Fiscal Quarter ending on
or after April 30, 2005. "EBITDA MARGIN" means for any period, the ratio of (a)
EBITDA for such period, to (b) net revenues (excluding the professional service
fee component of radiology services) for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(vii) RECEIVABLE DAYS. The Company shall not permit
the Receivable Days to exceed 65 days as of the end of any Fiscal Quarter ending
on or after April 30, 2005. "RECEIVABLE DAYS" means for any period, a number
equal to (a) 365 divided by (b) the result of (i) net revenues for such period
divided by (ii) net receivables for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(viii) NAME CHANGES, ETC. The Company agrees that it
shall not change its name or jurisdiction of organization without giving 30 days
prior written notice to USBPS.
10. To induce USBPS on behalf of the Trustee to enter this
Agreement, the Guarantor hereby affirms and restates its Guarantee as related to
this Loan and AMENDED AND RESTATED RIDER A.
11. Radnet, the Company and the Guarantor each represent and
warrant that each has been represented by an attorney of its choice and is fully
aware of the terms contained in this Agreement and AMENDED AND RESTATED RIDER A
to which it is a party which was voluntarily entered into without coercion or
duress of any kind.
12. Radnet represents and warrants to USBPS on behalf of the
Noteholders and Trustee that all necessary actions on the part of Radnet to be
taken in connection with the execution, delivery and performance of this
Agreement have been taken; the performance by Radnet of this Agreement and the
AMENDED AND RESTATED RIDER A will not violate any of
6
#1231-048
Radnet's Articles of Incorporation, Articles of Formation, Partnership Agreement
or other agreement or law by which Radnet is bound.
13. Any notice, request, direction, consent, approval, waiver
or other communication required or permitted under this Agreement to be sent
must be in writing and will become effective only upon delivery to USBPS at the
address set forth herein as follows:
U.S. Bank Portfolio Services
0000 Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxx, XX 00000
Attn: Xxxx Xxx, Director of Operations
14. Except as provided herein, and in the AMENDED AND RESTATED
RIDER A, all of the other provisions of the Loan Documents not restated will
remain in effect.
15. This Agreement and the documents referenced herein
constitute the entire and final agreement among the parties with respect to the
subject matter hereof and there are no agreements, understandings, warranties or
representations among the parties with respect to these matters except as set
forth herein.
16. This Agreement will inure to the benefit of and bind the
parties and their respective successors and permitted assigns.
17. Neither this Agreement nor any of the provisions hereof
can be changed, waived, discharged or terminated except by an instrument in
writing signed by the parties against whom such enforcement of the change,
waiver, discharge or termination is sought.
18. This Agreement will be interpreted and construed under the
laws of the Commonwealth of Pennsylvania, regardless of the domicile of any
party and will be considered to have been made, executed and performed in
Pennsylvania.
7
#1231-048
19. THE UNDERSIGNED, AND SUBJECT TO THE PROVISIONS CONTAINED
HEREIN, USBPS FOR ITSELF AND AS AGENT FOR THE TRUSTEE, (A) AGREE TO SUBMIT FOR
THEMSELVES, IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT AND ANY
SCHEDULE OR FOR RECOGNITION AND ENFORCEMENT OF ANY JUDGMENT IN RESPECT HEREOF OR
THEREOF, TO THE EXCLUSIVE JURISDICTION OF THE COURTS OF THE COMONWEALTH OF
PENNSYLVANIA, THE COURTS OF THE UNITED STATES OF AMERICA FOR THE EASTERN
DISTRICT OF PENNSYLVANIA, AND APPELLATE COURTS FROM ANY THEREOF, (B) CONSENT
THAT ANY ACTION OR PROCEEDING SHALL BE BROUGHT IN SUCH COURTS, AND WAIVE ANY
OBJECTION THAT EACH MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH ACTION OR
PROCEEDING IN ANY SUCH COURT, (C) AGREE THAT SERVICE OF PROCESS OF ANY SUCH
ACTION OR PROCEEDING MAY BE EFFECTED BY CERTIFIED MAIL (OR ANY SUBSTANTIALLY
SIMILAR FORM OF MAIL), POSTAGE PREPAID, TO THE APPROPRIATE PARTY AT ITS ADDRESS
AS SET FORTH HEREIN, AND SERVICE MADE SHALL BE DEEMED TO BE COMPLETED UPON THE
EARLIER OF ACTUAL RECEIPT OR FIVE (5) DAYS AFTER THE SAME SHALL HAVE BEEN POSTED
AS AFORESAID, AND (D) AGREE THAT NOTHING HEREIN OR IN ANY EXHIBIT OR SCHEDULE
SHALL AFFECT THE RIGHT TO EFFECT SERVICE OF PROCESS IN ANY OTHER MANNER
PERMITTED BY LAW. USBPS AND THE UNDERSIGNED EACH HEREBY UNCONDITIONALLY WAIVES
ITS RIGHT TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING
OUT OF, DIRECTLY OR INDIRECTLY, THIS AGREEMENT, ANY EXHIBIT AND THE TRANSACTIONS
8
#1231-048
CONTEMPLATED HEREBY AND THEREBY, ANY OF THE RELATED DOCUMENTS, ANY DEALINGS
BETWEEN THE PARTIES HERETO RELATING TO THE SUBJECT MATTER HEREOF OR THEREOF,
AND/OR THE RELATIONSHIP THAT IS BEING ESTABLISHED BETWEEN USBPS AS AGENT FOR THE
TRUSTEE AND THE UNDERSIGNED, PROVIDED USBPS MAY IN ITS DISCRETION ENFORCE THE
TERMS OF THE FORUM SELECTION PROVISIONS IN THE LOANS.
20. Radnet, the Company and the Guarantor hereby release
USBPS, the Trustee, and the Noteholders from and against any claim, loss, or
damage arising out of the negotiation execution, and performance of the Loan or
related matters prior to the date hereof.
21. This Agreement may be executed in two or more counterparts
and each counterpart shall be deemed an original.
9
#1231-048
LYON FINANCIAL SERVICES, INC. DBA U.S.
BANK PORTFOLIO SERVICES, AS SUCCESSOR
SERVICER FOR DVI RECEIVABLES XIX, L.L.C.
AND AS AGENT FOR U.S. BANK, N.A., AS TRUSTEE
By: ________________________________________
RADNET MANAGEMENT, INC.
By: ________________________________________
ACKNOWLEDGED AND AGREED TO:
Primedex Health Systems, Inc., Guarantor
By: ____________________________________
10
#1231-047
AMENDMENT TO LOAN DOCUMENTS
---------------------------
AGREEMENT made as of June 30, 2004 ("AMENDMENT AGREEMENT" or
"AGREEMENT") by and between LYON FINANCIAL SERVICES, INC. DBA U.S. BANK
PORTFOLIO SERVICES, as Successor Servicer for DVI Receivables XIX, L.L.C. and as
Agent for U.S. Bank, N.A., as Trustee, with offices at 0000 Xxxxxx Xxxxxx, Xxxxx
000, Xxxxxxxx, Xxxxxxxxx 00000 ("USBPS") and Radnet Management, Inc., a
corporation, with offices at 0000 Xxxxxx Xxxxxx, Xxx Xxxxxxx, XX 00000
("RADNET"), and such other signatories hereto.
WHEREAS, on or about Xxxxx 00, 0000, Xxxxxx executed and
delivered to DVI Financial Services Inc. ("DVI") a Loan and Security Agreement
collectively with the Schedule Number #1231-047 dated April 14, 2001 (the
"LOAN");
WHEREAS, to secure the payment of the Loan and all other
obligations of Radnet to DVI (collectively the "OBLIGATIONS"), Radnet, pursuant
to a Security Agreement dated on or about December 15, 1997 (the "SECURITY
AGREEMENT"), granted DVI a first priority security interest in certain
Collateral described therein;
WHEREAS, to further secure payment of the Note and all other
Obligations of Radnet to DVI, Radnet delivered to DVI the guarantee (the
"GUARANTEE") of Primedex Health Systems, Inc. (the "GUARANTOR") (the "GUARANTEE"
together with the Loan and ancillary documents are, collectively the "LOAN
DOCUMENTS");
WHEREAS, substantially contemporaneously therewith, DVI
contributed all of the Loan Documents to DVI Receivables XIX, L.L.C. ("DVI XIX")
and thereafter pursuant to an Amended and Restated Indenture, DVI XIX granted a
first priority security interest in and pledged all of the Loan Documents in
favor of U.S. Bank, N.A., as Trustee, for the benefit of a
#1231-047
noteholder which purchased asset backed promissory notes issued by DVI XIX (the
"Noteholder");
WHEREAS, DVI contributed other Loans with Radnet or certain
affiliates of Radnet to this and other DVI securitizations (collectively the
"RELATED LOANS");
WHEREAS, Radnet is in default under the terms of the Loan;
WHEREAS, Radnet has requested USBPS to modify the Loan to
reflect an adjustment in payments;
WHEREAS, Radnet and/or certain of its affiliates have agreed
to modify the Related Loans;
WHEREAS, Radnet and certain of its affiliates are engaged in
negotiations to restructure or modify certain loan agreements, loans and
promissory notes with each of General Electric Capital Corporation ("GECC") and
DVI (with respect to GECC, the "GECC MODIFICATION", and with respect to DVI, the
"DVI MODIFICATION");
WHEREAS, subject to the following terms and conditions, USBPS
is willing to modify the Loan as hereinafter provided.
NOW, THEREFORE, the parties agree as follows:
1. All of the Whereas clauses are incorporated herein as if
hereinafter set forth at full length.
2. Radnet acknowledges that it is duly indebted to the Trustee
in the sum set forth on AMENDED AND RESTATED RIDER A annexed hereto, and has no
defenses, counterclaims or offsets to such indebtedness.
3. USBPS as Agent for the Trustee will modify the Loan to
provide for payments to commence in accordance with the attached revised payment
schedule (the
2
#1231-047
"AMENDED AND RESTATED RIDER A"). Radnet may, at any time, prepay all of the then
outstanding Obligations subject to an additional prepayment fee of 2% of such
Obligations. Partial prepayments of the Obligations shall not be permitted at
any time.
4. This Agreement shall become effective upon the date that
USBPS receives this Agreement duly executed by Radnet and the satisfaction of
each of the following conditions:
(a) Radnet and/or its affiliates shall have entered
into agreements on similar terms to this Agreement and
otherwise in form and substance satisfactory to USBPS,
relating to the Related Loans (the "Related Loan
Modifications");
(b) reimbursement of USBPS's legal fees incurred in
connection with the execution of this Agreement and the
Related Loan Modifications, aggregating $50,000, shall have
been received by USBPS;
(c) Radnet and/or its affiliates shall have entered
into the GECC Modification and the DVI Modification.
5. The closing of the restructuring of the Radnet Loan is
further subject to delivery to USBPS of all of the following, each in form and
substance satisfactory to USBPS and its counsel:
(a) The executed AMENDED AND RESTATED RIDER A;
(b) An executed copy of this Agreement;
(c) Such other documents, including UCC financing
statements as USBPS reasonably requests.
6. Radnet hereby acknowledges and agrees that it has no, and
will not assert any, defenses, counterclaims or offsets to the Loan and AMENDED
AND RESTATED RIDER A and acknowledges and agrees that the Trustee holds a
first-priority security interest in the Collateral.
7. Any default or other breach of any obligation under the
GECC Modification, the DVI Modification, or any of the Related Loan
Modifications shall constitute a
3
#1231-047
default under the Loan as modified by this Agreement, and USBPS shall have all
remedies thereunder.
8. Radnet hereby releases the Noteholder, USBPS individually
and as agent for the Trustee and the special purpose entities for which the
Trustee holds collateral, from and against any claims, loss or damage of any
kind or nature arising out of the Loan.
9. So long as any of the Obligations remain outstanding,
Radnet Management, Inc. (the "COMPANY") agrees as follows:
(i) FINANCIAL REPORTING. The Company shall furnish
the following documents or information to USBPS:
(A) Within 30 days after the end of each
Fiscal Quarter (as defined below) (i) (or 90 days in respect of the last month
of the fiscal year), the Company's consolidated, consolidating and on a center
by center basis, financial statements, including the most recent annual report,
balance sheet (not on a center by center basis) and income statement, prepared
in accordance with generally accepted accounting principles, which reports, the
Company warrants, shall fully and fairly represent the true financial condition
of the Company and (ii) updated projections for the Company and for each center;
(B) any other financial information normally
provided by the Company to the public; and
(C) Such other financial data or information
relative to this Amendment Agreement, including, without limitation, listings of
serial numbers or other identification data and confirmations of such
information, as USBPS may time-to-time reasonably request.
(ii) NO AMENDMENTS. Subsequent to the date of this
Amendment Agreement, the Company will not agree or consent to any amendments or
modifications to any agreement between the Company and DVI, GECC or Xxxxx Fargo
Foothill, Inc. ("FOOTHILL") containing terms (including, but not limited to,
increasing interest rates, accelerating the principal amortization or maturity,
new or more stringent defaults, additional collateral, and new remedies
provisions) that would be more onerous to the Company, or adversely impact or
affect GECC with respect to the terms of this Amendment Agreement.
(iii) DISTRIBUTIONS. The Company shall not make any
distribution or declare or pay any dividends (in cash or other property, other
than common stock) on, or purchase, acquire, redeem, or retire any of the
Company's stock, of any class, whether now or hereafter outstanding
(collectively, "DISTRIBUTIONS"); PROVIDED, HOWEVER, that so long as no
4
#1231-047
default shall have occurred and be continuing immediately prior to or after
giving effect to any such payment, (a) the Company may make Distributions to
Primedex Health Systems, Inc., a New York corporation (the "PARENT") (1) in
amounts necessary to pay customary expenses of Parent in the ordinary course of
its business as a public holding company (including salaries and related
reasonable and customary expenses incurred by employees of Parent) in an
aggregate amount not to exceed $750,000 in any fiscal year, (2) in amounts
necessary to enable Parent to pay taxes when due and owing by it in the ordinary
course of its business as a holding company and (3) in amounts necessary to
enable Parent to pay interest on those certain 11.5% Series A Convertible
Subordinated Notes due June 30, 2008, issued by Parent on June 25, 1993, and (b)
Parent may make Distributions in the form of common stock.
(iv) FIXED CHARGE COVERAGE RATIO. Commencing April
30, 2005, the Company shall not permit the Fixed Charge Coverage Ratio, (a) to
be less than 1.0:1 as of the end of each April, July, October and January (each,
a "FISCAL QUARTER") ending prior to January 1, 2007, and (b) to be less than
1.05:1 as of the last day of each Fiscal Quarter ending thereafter. "FIXED
CHARGE COVERAGE RATIO" means for any period, the ratio of (i) EBITDA for such
period MINUS cash capital expenditures made (to the extent not already incurred
in a prior period) or incurred during such period, to (ii) the sum of (a)
interest expense, (b) principal payments required to be paid during such period
in respect of indebtedness, and (c) all federal, state, and local income taxes
accrued, all as determined for the twelve months ending on the determination
date for the Company and its subsidiaries on a consolidated basis without
duplication and in accordance with generally accepted accounting principles
consistently applied. "EBITDA" means, with respect to any fiscal period, the
Company's and its subsidiaries' consolidated net earnings (or loss), minus
extraordinary gains and interest income, plus interest expense, income taxes,
and depreciation and amortization for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(v) LEVERAGE RATIO. The Company shall not permit the
Leverage Ratio, as determined as of the end of each Fiscal Quarter, to be
greater than the amount set forth in the following table for the Fiscal Quarters
ending in the period set forth opposite thereto:
LEVERAGE RATIO PERIOD
-------------- ------
4.50:1.0 04/30/05 - 10/30/05
4.30:1.0 10/31/05 - 10/30/06
4.00:1.0 10/31/06 - 10/30/07
3.80:1.0 10/31/07 - 10/30/08
"LEVERAGE RATIO" means, at any date of determination, the
ratio of (a) Total Debt at such date to (b) EBITDA for the applicable period
ending on such date. "TOTAL DEBT" means, as of any date of determination,
without duplication, the sum of (a) the outstanding aggregate amount of the
obligations for borrowed money, (b) the outstanding principal amount of capital
leases, (c) the outstanding principal amount of purchase money indebtedness, (d)
the outstanding principal amount of funded debt, and (e) the outstanding
principal amount of all obligations
5
#1231-047
owing to GECC, DVI and USBPS; all as determined for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(vi) EBITDA MARGIN. The Company shall not permit the
EBITDA Margin to be less than 25% as of the end of any Fiscal Quarter ending on
or after April 30, 2005. "EBITDA MARGIN" means for any period, the ratio of (a)
EBITDA for such period, to (b) net revenues (excluding the professional service
fee component of radiology services) for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(vii) RECEIVABLE DAYS. The Company shall not permit
the Receivable Days to exceed 65 days as of the end of any Fiscal Quarter ending
on or after April 30, 2005. "RECEIVABLE DAYS" means for any period, a number
equal to (a) 365 divided by (b) the result of (i) net revenues for such period
divided by (ii) net receivables for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(viii) NAME CHANGES, ETC. The Company agrees that it
shall not change its name or jurisdiction of organization without giving 30 days
prior written notice to USBPS.
10. To induce USBPS on behalf of the Trustee to enter this
Agreement, the Guarantor hereby affirms and restates its Guarantee as related to
this Loan and AMENDED AND RESTATED RIDER A.
11. Radnet, the Company and the Guarantor each represent and
warrant that each has been represented by an attorney of its choice and is fully
aware of the terms contained in this Agreement and AMENDED AND RESTATED RIDER A
to which it is a party which was voluntarily entered into without coercion or
duress of any kind.
12. Radnet represents and warrants to USBPS on behalf of the
Noteholders and Trustee that all necessary actions on the part of Radnet to be
taken in connection with the execution, delivery and performance of this
Agreement have been taken; the performance by Radnet of this Agreement and the
AMENDED AND RESTATED RIDER A will not violate any of
6
#1231-047
Radnet's Articles of Incorporation, Articles of Formation, Partnership Agreement
or other agreement or law by which Radnet is bound.
13. Any notice, request, direction, consent, approval, waiver
or other communication required or permitted under this Agreement to be sent
must be in writing and will become effective only upon delivery to USBPS at the
address set forth herein as follows:
U.S. Bank Portfolio Services
0000 Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxx, XX 00000
Attn: Xxxx Xxx, Director of Operations
14. Except as provided herein, and in the AMENDED AND RESTATED
RIDER A, all of the other provisions of the Loan Documents not restated will
remain in effect.
15. This Agreement and the documents referenced herein
constitute the entire and final agreement among the parties with respect to the
subject matter hereof and there are no agreements, understandings, warranties or
representations among the parties with respect to these matters except as set
forth herein.
16. This Agreement will inure to the benefit of and bind the
parties and their respective successors and permitted assigns.
17. Neither this Agreement nor any of the provisions hereof
can be changed, waived, discharged or terminated except by an instrument in
writing signed by the parties against whom such enforcement of the change,
waiver, discharge or termination is sought.
18. This Agreement will be interpreted and construed under the
laws of the Commonwealth of Pennsylvania, regardless of the domicile of any
party and will be considered to have been made, executed and performed in
Pennsylvania.
7
#1231-047
19. THE UNDERSIGNED, AND SUBJECT TO THE PROVISIONS CONTAINED
HEREIN, USBPS FOR ITSELF AND AS AGENT FOR THE TRUSTEE, (A) AGREE TO SUBMIT FOR
THEMSELVES, IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT AND ANY
SCHEDULE OR FOR RECOGNITION AND ENFORCEMENT OF ANY JUDGMENT IN RESPECT HEREOF OR
THEREOF, TO THE EXCLUSIVE JURISDICTION OF THE COURTS OF THE COMONWEALTH OF
PENNSYLVANIA, THE COURTS OF THE UNITED STATES OF AMERICA FOR THE EASTERN
DISTRICT OF PENNSYLVANIA, AND APPELLATE COURTS FROM ANY THEREOF, (B) CONSENT
THAT ANY ACTION OR PROCEEDING SHALL BE BROUGHT IN SUCH COURTS, AND WAIVE ANY
OBJECTION THAT EACH MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH ACTION OR
PROCEEDING IN ANY SUCH COURT, (C) AGREE THAT SERVICE OF PROCESS OF ANY SUCH
ACTION OR PROCEEDING MAY BE EFFECTED BY CERTIFIED MAIL (OR ANY SUBSTANTIALLY
SIMILAR FORM OF MAIL), POSTAGE PREPAID, TO THE APPROPRIATE PARTY AT ITS ADDRESS
AS SET FORTH HEREIN, AND SERVICE MADE SHALL BE DEEMED TO BE COMPLETED UPON THE
EARLIER OF ACTUAL RECEIPT OR FIVE (5) DAYS AFTER THE SAME SHALL HAVE BEEN POSTED
AS AFORESAID, AND (D) AGREE THAT NOTHING HEREIN OR IN ANY EXHIBIT OR SCHEDULE
SHALL AFFECT THE RIGHT TO EFFECT SERVICE OF PROCESS IN ANY OTHER MANNER
PERMITTED BY LAW. USBPS AND THE UNDERSIGNED EACH HEREBY UNCONDITIONALLY WAIVES
ITS RIGHT TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING
OUT OF, DIRECTLY OR INDIRECTLY, THIS AGREEMENT, ANY EXHIBIT AND THE TRANSACTIONS
8
#1231-047
CONTEMPLATED HEREBY AND THEREBY, ANY OF THE RELATED DOCUMENTS, ANY DEALINGS
BETWEEN THE PARTIES HERETO RELATING TO THE SUBJECT MATTER HEREOF OR THEREOF,
AND/OR THE RELATIONSHIP THAT IS BEING ESTABLISHED BETWEEN USBPS AS AGENT FOR THE
TRUSTEE AND THE UNDERSIGNED, PROVIDED USBPS MAY IN ITS DISCRETION ENFORCE THE
TERMS OF THE FORUM SELECTION PROVISIONS IN THE LOANS.
20. Radnet, the Company and the Guarantor hereby release
USBPS, the Trustee, and the Noteholders from and against any claim, loss, or
damage arising out of the negotiation execution, and performance of the Loan or
related matters prior to the date hereof.
21. This Agreement may be executed in two or more counterparts
and each counterpart shall be deemed an original.
9
#1231-047
LYON FINANCIAL SERVICES, INC. DBA U.S.
BANK PORTFOLIO SERVICES, AS SUCCESSOR
SERVICER FOR DVI RECEIVABLES XIX, L.L.C.
AND AS AGENT FOR U.S. BANK, N.A., AS TRUSTEE
By: ________________________________________
RADNET MANAGEMENT, INC.
By: ________________________________________
ACKNOWLEDGED AND AGREED TO:
Primedex Health Systems, Inc., Guarantor
By: ____________________________________
10
#1231-046
AMENDMENT TO LOAN DOCUMENTS
---------------------------
AGREEMENT made as of June 30, 2004 ("AMENDMENT AGREEMENT" or
"AGREEMENT") by and between LYON FINANCIAL SERVICES, INC. DBA U.S. BANK
PORTFOLIO SERVICES, as Successor Servicer for DVI Receivables XIV, L.L.C. and as
Agent for U.S. Bank, N.A., as Trustee, with offices at 0000 Xxxxxx Xxxxxx, Xxxxx
000, Xxxxxxxx, Xxxxxxxxx 00000 ("USBPS") and Radnet Management, Inc., a
corporation, with offices at 0000 Xxxxxx Xxxxxx, Xxx Xxxxxxx, XX 00000
("RADNET"), and such other signatories hereto.
WHEREAS, on or about Xxxxx 00, 0000, Xxxxxx executed and
delivered to DVI Financial Services Inc. ("DVI") a Loan and Security Agreement
collectively with the Schedule Number #1231-046 dated September 27, 2000 (the
"LOAN");
WHEREAS, to secure the payment of the Loan and all other
obligations of Radnet to DVI (collectively the "OBLIGATIONS"), Radnet, pursuant
to a Security Agreement dated on or about December 15, 1997 (the "SECURITY
AGREEMENT"), granted DVI a first priority security interest in certain
Collateral described therein;
WHEREAS, to further secure payment of the Note and all other
Obligations of Radnet to DVI, Radnet delivered to DVI the guarantee (the
"GUARANTEE") of Primedex Health Systems, Inc. (the "GUARANTOR") (the "GUARANTEE"
together with the Loan and ancillary documents are, collectively the "LOAN
DOCUMENTS");
WHEREAS, substantially contemporaneously therewith, DVI
contributed all of the Loan Documents to DVI Receivables XIV, L.L.C. ("DVI XIV")
and thereafter pursuant to an Amended and Restated Indenture, DVI XIV granted a
first priority security interest in and pledged all of the Loan Documents in
favor of U.S. Bank, N.A., as Trustee, for the benefit of a
#1231-046
noteholder which purchased asset backed promissory notes issued by DVI XIV (the
"Noteholder");
WHEREAS, DVI contributed other Loans with Radnet or certain
affiliates of Radnet to this and other DVI securitizations (collectively the
"RELATED LOANS");
WHEREAS, Radnet is in default under the terms of the Loan;
WHEREAS, Radnet has requested USBPS to modify the Loan to
reflect an adjustment in payments;
WHEREAS, Radnet and/or certain of its affiliates have agreed
to modify the Related Loans;
WHEREAS, Radnet and certain of its affiliates are engaged in
negotiations to restructure or modify certain loan agreements, loans and
promissory notes with each of General Electric Capital Corporation ("GECC") and
DVI (with respect to GECC, the "GECC MODIFICATION", and with respect to DVI, the
"DVI MODIFICATION");
WHEREAS, subject to the following terms and conditions, USBPS
is willing to modify the Loan as hereinafter provided.
NOW, THEREFORE, the parties agree as follows:
1. All of the Whereas clauses are incorporated herein as if
hereinafter set forth at full length.
2. Radnet acknowledges that it is duly indebted to the Trustee
in the sum set forth on AMENDED AND RESTATED RIDER A annexed hereto, and has no
defenses, counterclaims or offsets to such indebtedness.
3. USBPS as Agent for the Trustee will modify the Loan to
provide for payments to commence in accordance with the attached revised payment
schedule (the
2
#1231-046
"AMENDED AND RESTATED RIDER A"). Radnet may, at any time, prepay all of the then
outstanding Obligations subject to an additional prepayment fee of 2% of such
Obligations. Partial prepayments of the Obligations shall not be permitted at
any time.
4. This Agreement shall become effective upon the date that
USBPS receives this Agreement duly executed by Radnet and the satisfaction of
each of the following conditions:
(a) Radnet and/or its affiliates shall have entered
into agreements on similar terms to this Agreement and
otherwise in form and substance satisfactory to USBPS,
relating to the Related Loans (the "Related Loan
Modifications");
(b) reimbursement of USBPS's legal fees incurred in
connection with the execution of this Agreement and the
Related Loan Modifications, aggregating $50,000, shall have
been received by USBPS;
(c) Radnet and/or its affiliates shall have entered
into the GECC Modification and the DVI Modification.
5. The closing of the restructuring of the Radnet Loan is
further subject to delivery to USBPS of all of the following, each in form and
substance satisfactory to USBPS and its counsel:
(a) The executed AMENDED AND RESTATED RIDER A;
(b) An executed copy of this Agreement;
(c) Such other documents, including UCC financing
statements as USBPS reasonably requests.
6. Radnet hereby acknowledges and agrees that it has no, and
will not assert any, defenses, counterclaims or offsets to the Loan and AMENDED
AND RESTATED RIDER A and acknowledges and agrees that the Trustee holds a
first-priority security interest in the Collateral.
7. Any default or other breach of any obligation under the
GECC Modification, the DVI Modification, or any of the Related Loan
Modifications shall constitute a
3
#1231-046
default under the Loan as modified by this Agreement, and USBPS shall have all
remedies thereunder.
8. Radnet hereby releases the Noteholder, USBPS individually
and as agent for the Trustee and the special purpose entities for which the
Trustee holds collateral, from and against any claims, loss or damage of any
kind or nature arising out of the Loan.
9. So long as any of the Obligations remain outstanding,
Radnet Management, Inc. (the "COMPANY") agrees as follows:
(i) FINANCIAL REPORTING. The Company shall furnish
the following documents or information to USBPS:
(A) Within 30 days after the end of each
Fiscal Quarter (as defined below) (i) (or 90 days in respect of the last month
of the fiscal year), the Company's consolidated, consolidating and on a center
by center basis, financial statements, including the most recent annual report,
balance sheet (not on a center by center basis) and income statement, prepared
in accordance with generally accepted accounting principles, which reports, the
Company warrants, shall fully and fairly represent the true financial condition
of the Company and (ii) updated projections for the Company and for each center;
(B) any other financial information normally
provided by the Company to the public; and
(C) Such other financial data or information
relative to this Amendment Agreement, including, without limitation, listings of
serial numbers or other identification data and confirmations of such
information, as USBPS may time-to-time reasonably request.
(ii) NO AMENDMENTS. Subsequent to the date of this
Amendment Agreement, the Company will not agree or consent to any amendments or
modifications to any agreement between the Company and DVI, GECC or Xxxxx Fargo
Foothill, Inc. ("FOOTHILL") containing terms (including, but not limited to,
increasing interest rates, accelerating the principal amortization or maturity,
new or more stringent defaults, additional collateral, and new remedies
provisions) that would be more onerous to the Company, or adversely impact or
affect GECC with respect to the terms of this Amendment Agreement.
(iii) DISTRIBUTIONS. The Company shall not make any
distribution or declare or pay any dividends (in cash or other property, other
than common stock) on, or purchase, acquire, redeem, or retire any of the
Company's stock, of any class, whether now or hereafter outstanding
(collectively, "DISTRIBUTIONS"); PROVIDED, HOWEVER, that so long as no
4
#1231-046
default shall have occurred and be continuing immediately prior to or after
giving effect to any such payment, (a) the Company may make Distributions to
Primedex Health Systems, Inc., a New York corporation (the "PARENT") (1) in
amounts necessary to pay customary expenses of Parent in the ordinary course of
its business as a public holding company (including salaries and related
reasonable and customary expenses incurred by employees of Parent) in an
aggregate amount not to exceed $750,000 in any fiscal year, (2) in amounts
necessary to enable Parent to pay taxes when due and owing by it in the ordinary
course of its business as a holding company and (3) in amounts necessary to
enable Parent to pay interest on those certain 11.5% Series A Convertible
Subordinated Notes due June 30, 2008, issued by Parent on June 25, 1993, and (b)
Parent may make Distributions in the form of common stock.
(iv) FIXED CHARGE COVERAGE RATIO. Commencing April
30, 2005, the Company shall not permit the Fixed Charge Coverage Ratio, (a) to
be less than 1.0:1 as of the end of each April, July, October and January (each,
a "FISCAL QUARTER") ending prior to January 1, 2007, and (b) to be less than
1.05:1 as of the last day of each Fiscal Quarter ending thereafter. "FIXED
CHARGE COVERAGE RATIO" means for any period, the ratio of (i) EBITDA for such
period MINUS cash capital expenditures made (to the extent not already incurred
in a prior period) or incurred during such period, to (ii) the sum of (a)
interest expense, (b) principal payments required to be paid during such period
in respect of indebtedness, and (c) all federal, state, and local income taxes
accrued, all as determined for the twelve months ending on the determination
date for the Company and its subsidiaries on a consolidated basis without
duplication and in accordance with generally accepted accounting principles
consistently applied. "EBITDA" means, with respect to any fiscal period, the
Company's and its subsidiaries' consolidated net earnings (or loss), minus
extraordinary gains and interest income, plus interest expense, income taxes,
and depreciation and amortization for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(v) LEVERAGE RATIO. The Company shall not permit the
Leverage Ratio, as determined as of the end of each Fiscal Quarter, to be
greater than the amount set forth in the following table for the Fiscal Quarters
ending in the period set forth opposite thereto:
LEVERAGE RATIO PERIOD
-------------- ------
4.50:1.0 04/30/05 - 10/30/05
4.30:1.0 10/31/05 - 10/30/06
4.00:1.0 10/31/06 - 10/30/07
3.80:1.0 10/31/07 - 10/30/08
"LEVERAGE RATIO" means, at any date of determination, the
ratio of (a) Total Debt at such date to (b) EBITDA for the applicable period
ending on such date. "TOTAL DEBT" means, as of any date of determination,
without duplication, the sum of (a) the outstanding aggregate amount of the
obligations for borrowed money, (b) the outstanding principal amount of capital
leases, (c) the outstanding principal amount of purchase money indebtedness, (d)
the outstanding principal amount of funded debt, and (e) the outstanding
principal amount of all obligations
5
#1231-046
owing to GECC, DVI and USBPS; all as determined for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(vi) EBITDA MARGIN. The Company shall not permit the
EBITDA Margin to be less than 25% as of the end of any Fiscal Quarter ending on
or after April 30, 2005. "EBITDA MARGIN" means for any period, the ratio of (a)
EBITDA for such period, to (b) net revenues (excluding the professional service
fee component of radiology services) for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(vii) RECEIVABLE DAYS. The Company shall not permit
the Receivable Days to exceed 65 days as of the end of any Fiscal Quarter ending
on or after April 30, 2005. "RECEIVABLE DAYS" means for any period, a number
equal to (a) 365 divided by (b) the result of (i) net revenues for such period
divided by (ii) net receivables for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(viii) NAME CHANGES, ETC. The Company agrees that it
shall not change its name or jurisdiction of organization without giving 30 days
prior written notice to USBPS.
10. To induce USBPS on behalf of the Trustee to enter this
Agreement, the Guarantor hereby affirms and restates its Guarantee as related to
this Loan and AMENDED AND RESTATED RIDER A.
11. Radnet, the Company and the Guarantor each represent and
warrant that each has been represented by an attorney of its choice and is fully
aware of the terms contained in this Agreement and AMENDED AND RESTATED RIDER A
to which it is a party which was voluntarily entered into without coercion or
duress of any kind.
12. Radnet represents and warrants to USBPS on behalf of the
Noteholders and Trustee that all necessary actions on the part of Radnet to be
taken in connection with the execution, delivery and performance of this
Agreement have been taken; the performance by Radnet of this Agreement and the
AMENDED AND RESTATED RIDER A will not violate any of
6
#1231-046
Radnet's Articles of Incorporation, Articles of Formation, Partnership Agreement
or other agreement or law by which Radnet is bound.
13. Any notice, request, direction, consent, approval, waiver
or other communication required or permitted under this Agreement to be sent
must be in writing and will become effective only upon delivery to USBPS at the
address set forth herein as follows:
U.S. Bank Portfolio Services
0000 Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxx, XX 00000
Attn: Xxxx Xxx, Director of Operations
14. Except as provided herein, and in the AMENDED AND RESTATED
RIDER A, all of the other provisions of the Loan Documents not restated will
remain in effect.
15. This Agreement and the documents referenced herein
constitute the entire and final agreement among the parties with respect to the
subject matter hereof and there are no agreements, understandings, warranties or
representations among the parties with respect to these matters except as set
forth herein.
16. This Agreement will inure to the benefit of and bind the
parties and their respective successors and permitted assigns.
17. Neither this Agreement nor any of the provisions hereof
can be changed, waived, discharged or terminated except by an instrument in
writing signed by the parties against whom such enforcement of the change,
waiver, discharge or termination is sought.
18. This Agreement will be interpreted and construed under the
laws of the Commonwealth of Pennsylvania, regardless of the domicile of any
party and will be considered to have been made, executed and performed in
Pennsylvania.
7
#1231-046
19. THE UNDERSIGNED, AND SUBJECT TO THE PROVISIONS CONTAINED
HEREIN, USBPS FOR ITSELF AND AS AGENT FOR THE TRUSTEE, (A) AGREE TO SUBMIT FOR
THEMSELVES, IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT AND ANY
SCHEDULE OR FOR RECOGNITION AND ENFORCEMENT OF ANY JUDGMENT IN RESPECT HEREOF OR
THEREOF, TO THE EXCLUSIVE JURISDICTION OF THE COURTS OF THE COMONWEALTH OF
PENNSYLVANIA, THE COURTS OF THE UNITED STATES OF AMERICA FOR THE EASTERN
DISTRICT OF PENNSYLVANIA, AND APPELLATE COURTS FROM ANY THEREOF, (B) CONSENT
THAT ANY ACTION OR PROCEEDING SHALL BE BROUGHT IN SUCH COURTS, AND WAIVE ANY
OBJECTION THAT EACH MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH ACTION OR
PROCEEDING IN ANY SUCH COURT, (C) AGREE THAT SERVICE OF PROCESS OF ANY SUCH
ACTION OR PROCEEDING MAY BE EFFECTED BY CERTIFIED MAIL (OR ANY SUBSTANTIALLY
SIMILAR FORM OF MAIL), POSTAGE PREPAID, TO THE APPROPRIATE PARTY AT ITS ADDRESS
AS SET FORTH HEREIN, AND SERVICE MADE SHALL BE DEEMED TO BE COMPLETED UPON THE
EARLIER OF ACTUAL RECEIPT OR FIVE (5) DAYS AFTER THE SAME SHALL HAVE BEEN POSTED
AS AFORESAID, AND (D) AGREE THAT NOTHING HEREIN OR IN ANY EXHIBIT OR SCHEDULE
SHALL AFFECT THE RIGHT TO EFFECT SERVICE OF PROCESS IN ANY OTHER MANNER
PERMITTED BY LAW. USBPS AND THE UNDERSIGNED EACH HEREBY UNCONDITIONALLY WAIVES
ITS RIGHT TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING
OUT OF, DIRECTLY OR INDIRECTLY, THIS AGREEMENT, ANY EXHIBIT AND THE TRANSACTIONS
8
#1231-046
CONTEMPLATED HEREBY AND THEREBY, ANY OF THE RELATED DOCUMENTS, ANY DEALINGS
BETWEEN THE PARTIES HERETO RELATING TO THE SUBJECT MATTER HEREOF OR THEREOF,
AND/OR THE RELATIONSHIP THAT IS BEING ESTABLISHED BETWEEN USBPS AS AGENT FOR THE
TRUSTEE AND THE UNDERSIGNED, PROVIDED USBPS MAY IN ITS DISCRETION ENFORCE THE
TERMS OF THE FORUM SELECTION PROVISIONS IN THE LOANS.
20. Radnet, the Company and the Guarantor hereby release
USBPS, the Trustee, and the Noteholders from and against any claim, loss, or
damage arising out of the negotiation execution, and performance of the Loan or
related matters prior to the date hereof.
21. This Agreement may be executed in two or more counterparts
and each counterpart shall be deemed an original.
9
#1231-046
LYON FINANCIAL SERVICES, INC. DBA U.S.
BANK PORTFOLIO SERVICES, AS SUCCESSOR
SERVICER FOR DVI RECEIVABLES XIV, L.L.C.
AND AS AGENT FOR U.S. BANK, N.A., AS TRUSTEE
By: ________________________________________
RADNET MANAGEMENT, INC.
By: ________________________________________
ACKNOWLEDGED AND AGREED TO:
Primedex Health Systems, Inc., Guarantor
By: ____________________________________
10
#1231-045
AMENDMENT TO LOAN DOCUMENTS
---------------------------
AGREEMENT made as of June 30, 2004 ("AMENDMENT AGREEMENT" or
"AGREEMENT") by and between LYON FINANCIAL SERVICES, INC. DBA U.S. BANK
PORTFOLIO SERVICES, as Successor Servicer for DVI Receivables XIV, L.L.C. and as
Agent for U.S. Bank, N.A., as Trustee, with offices at 0000 Xxxxxx Xxxxxx, Xxxxx
000, Xxxxxxxx, Xxxxxxxxx 00000 ("USBPS") and Radnet Management, Inc., a
corporation, with offices at 0000 Xxxxxx Xxxxxx, Xxx Xxxxxxx, XX 00000
("RADNET"), and such other signatories hereto.
WHEREAS, on or about Xxxxx 00, 0000, Xxxxxx executed and
delivered to DVI Financial Services Inc. ("DVI") a Loan and Security Agreement
collectively with the Schedule Number #1231-045 dated September 21, 2000 (the
"LOAN");
WHEREAS, to secure the payment of the Loan and all other
obligations of Radnet to DVI (collectively the "OBLIGATIONS"), Radnet, pursuant
to a Security Agreement dated on or about December 15, 1997 (the "SECURITY
AGREEMENT"), granted DVI a first priority security interest in certain
Collateral described therein;
WHEREAS, to further secure payment of the Note and all other
Obligations of Radnet to DVI, Radnet delivered to DVI the guarantee (the
"GUARANTEE") of Primedex Health Systems, Inc. (the "GUARANTOR") (the "GUARANTEE"
together with the Loan and ancillary documents are, collectively the "LOAN
DOCUMENTS");
WHEREAS, substantially contemporaneously therewith, DVI
contributed all of the Loan Documents to DVI Receivables XIV, L.L.C. ("DVI XIV")
and thereafter pursuant to an Amended and Restated Indenture, DVI XIV granted a
first priority security interest in and pledged all of the Loan Documents in
favor of U.S. Bank, N.A., as Trustee, for the benefit of a
#1231-045
noteholder which purchased asset backed promissory notes issued by DVI XIV (the
"Noteholder");
WHEREAS, DVI contributed other Loans with Radnet or certain
affiliates of Radnet to this and other DVI securitizations (collectively the
"RELATED LOANS");
WHEREAS, Radnet is in default under the terms of the Loan;
WHEREAS, Radnet has requested USBPS to modify the Loan to
reflect an adjustment in payments;
WHEREAS, Radnet and/or certain of its affiliates have agreed
to modify the Related Loans;
WHEREAS, Radnet and certain of its affiliates are engaged in
negotiations to restructure or modify certain loan agreements, loans and
promissory notes with each of General Electric Capital Corporation ("GECC") and
DVI (with respect to GECC, the "GECC MODIFICATION", and with respect to DVI, the
"DVI MODIFICATION");
WHEREAS, subject to the following terms and conditions, USBPS
is willing to modify the Loan as hereinafter provided.
NOW, THEREFORE, the parties agree as follows:
1. All of the Whereas clauses are incorporated herein as if
hereinafter set forth at full length.
2. Radnet acknowledges that it is duly indebted to the Trustee
in the sum set forth on AMENDED AND RESTATED RIDER A annexed hereto, and has no
defenses, counterclaims or offsets to such indebtedness.
3. USBPS as Agent for the Trustee will modify the Loan to
provide for payments to commence in accordance with the attached revised payment
schedule (the
2
#1231-045
"AMENDED AND RESTATED RIDER A"). Radnet may, at any time, prepay all of the then
outstanding Obligations subject to an additional prepayment fee of 2% of such
Obligations. Partial prepayments of the Obligations shall not be permitted at
any time.
4. This Agreement shall become effective upon the date that
USBPS receives this Agreement duly executed by Radnet and the satisfaction of
each of the following conditions:
(a) Radnet and/or its affiliates shall have entered
into agreements on similar terms to this Agreement and
otherwise in form and substance satisfactory to USBPS,
relating to the Related Loans (the "Related Loan
Modifications");
(b) reimbursement of USBPS's legal fees incurred in
connection with the execution of this Agreement and the
Related Loan Modifications, aggregating $50,000, shall have
been received by USBPS;
(c) Radnet and/or its affiliates shall have entered
into the GECC Modification and the DVI Modification.
5. The closing of the restructuring of the Radnet Loan is
further subject to delivery to USBPS of all of the following, each in form and
substance satisfactory to USBPS and its counsel:
(a) The executed AMENDED AND RESTATED RIDER A;
(b) An executed copy of this Agreement;
(c) Such other documents, including UCC financing
statements as USBPS reasonably requests.
6. Radnet hereby acknowledges and agrees that it has no, and
will not assert any, defenses, counterclaims or offsets to the Loan and AMENDED
AND RESTATED RIDER A and acknowledges and agrees that the Trustee holds a
first-priority security interest in the Collateral.
7. Any default or other breach of any obligation under the
GECC Modification, the DVI Modification, or any of the Related Loan
Modifications shall constitute a
3
#1231-045
default under the Loan as modified by this Agreement, and USBPS shall have all
remedies thereunder.
8. Radnet hereby releases the Noteholder, USBPS individually
and as agent for the Trustee and the special purpose entities for which the
Trustee holds collateral, from and against any claims, loss or damage of any
kind or nature arising out of the Loan.
9. So long as any of the Obligations remain outstanding,
Radnet Management, Inc. (the "COMPANY") agrees as follows:
(i) FINANCIAL REPORTING. The Company shall furnish
the following documents or information to USBPS:
(A) Within 30 days after the end of each
Fiscal Quarter (as defined below) (i) (or 90 days in respect of the last month
of the fiscal year), the Company's consolidated, consolidating and on a center
by center basis, financial statements, including the most recent annual report,
balance sheet (not on a center by center basis) and income statement, prepared
in accordance with generally accepted accounting principles, which reports, the
Company warrants, shall fully and fairly represent the true financial condition
of the Company and (ii) updated projections for the Company and for each center;
(B) any other financial information normally
provided by the Company to the public; and
(C) Such other financial data or information
relative to this Amendment Agreement, including, without limitation, listings of
serial numbers or other identification data and confirmations of such
information, as USBPS may time-to-time reasonably request.
(ii) NO AMENDMENTS. Subsequent to the date of this
Amendment Agreement, the Company will not agree or consent to any amendments or
modifications to any agreement between the Company and DVI, GECC or Xxxxx Fargo
Foothill, Inc. ("FOOTHILL") containing terms (including, but not limited to,
increasing interest rates, accelerating the principal amortization or maturity,
new or more stringent defaults, additional collateral, and new remedies
provisions) that would be more onerous to the Company, or adversely impact or
affect GECC with respect to the terms of this Amendment Agreement.
(iii) DISTRIBUTIONS. The Company shall not make any
distribution or declare or pay any dividends (in cash or other property, other
than common stock) on, or purchase, acquire, redeem, or retire any of the
Company's stock, of any class, whether now or hereafter outstanding
(collectively, "DISTRIBUTIONS"); PROVIDED, HOWEVER, that so long as no
4
#1231-045
default shall have occurred and be continuing immediately prior to or after
giving effect to any such payment, (a) the Company may make Distributions to
Primedex Health Systems, Inc., a New York corporation (the "PARENT") (1) in
amounts necessary to pay customary expenses of Parent in the ordinary course of
its business as a public holding company (including salaries and related
reasonable and customary expenses incurred by employees of Parent) in an
aggregate amount not to exceed $750,000 in any fiscal year, (2) in amounts
necessary to enable Parent to pay taxes when due and owing by it in the ordinary
course of its business as a holding company and (3) in amounts necessary to
enable Parent to pay interest on those certain 11.5% Series A Convertible
Subordinated Notes due June 30, 2008, issued by Parent on June 25, 1993, and (b)
Parent may make Distributions in the form of common stock.
(iv) FIXED CHARGE COVERAGE RATIO. Commencing April
30, 2005, the Company shall not permit the Fixed Charge Coverage Ratio, (a) to
be less than 1.0:1 as of the end of each April, July, October and January (each,
a "FISCAL QUARTER") ending prior to January 1, 2007, and (b) to be less than
1.05:1 as of the last day of each Fiscal Quarter ending thereafter. "FIXED
CHARGE COVERAGE RATIO" means for any period, the ratio of (i) EBITDA for such
period minus cash capital expenditures made (to the extent not already incurred
in a prior period) or incurred during such period, to (ii) the sum of (a)
interest expense, (b) principal payments required to be paid during such period
in respect of indebtedness, and (c) all federal, state, and local income taxes
accrued, all as determined for the twelve months ending on the determination
date for the Company and its subsidiaries on a consolidated basis without
duplication and in accordance with generally accepted accounting principles
consistently applied. "EBITDA" means, with respect to any fiscal period, the
Company's and its subsidiaries' consolidated net earnings (or loss), minus
extraordinary gains and interest income, plus interest expense, income taxes,
and depreciation and amortization for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(v) LEVERAGE RATIO. The Company shall not permit the
Leverage Ratio, as determined as of the end of each Fiscal Quarter, to be
greater than the amount set forth in the following table for the Fiscal Quarters
ending in the period set forth opposite thereto:
LEVERAGE RATIO PERIOD
-------------- ------
4.50:1.0 04/30/05 - 10/30/05
4.30:1.0 10/31/05 - 10/30/06
4.00:1.0 10/31/06 - 10/30/07
3.80:1.0 10/31/07 - 10/30/08
"LEVERAGE RATIO" means, at any date of determination, the
ratio of (a) Total Debt at such date to (b) EBITDA for the applicable period
ending on such date. "TOTAL DEBT" means, as of any date of determination,
without duplication, the sum of (a) the outstanding aggregate amount of the
obligations for borrowed money, (b) the outstanding principal amount of capital
leases, (c) the outstanding principal amount of purchase money indebtedness, (d)
the outstanding principal amount of funded debt, and (e) the outstanding
principal amount of all obligations
5
#1231-045
owing to GECC, DVI and USBPS; all as determined for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(vi) EBITDA MARGIN. The Company shall not permit the
EBITDA Margin to be less than 25% as of the end of any Fiscal Quarter ending on
or after April 30, 2005. "EBITDA MARGIN" means for any period, the ratio of (a)
EBITDA for such period, to (b) net revenues (excluding the professional service
fee component of radiology services) for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(vii) RECEIVABLE DAYS. The Company shall not permit
the Receivable Days to exceed 65 days as of the end of any Fiscal Quarter ending
on or after April 30, 2005. "RECEIVABLE DAYS" means for any period, a number
equal to (a) 365 divided by (b) the result of (i) net revenues for such period
divided by (ii) net receivables for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(viii) NAME CHANGES, ETC. The Company agrees that it
shall not change its name or jurisdiction of organization without giving 30 days
prior written notice to USBPS.
10. To induce USBPS on behalf of the Trustee to enter this
Agreement, the Guarantor hereby affirms and restates its Guarantee as related to
this Loan and AMENDED AND RESTATED RIDER A.
11. Radnet, the Company and the Guarantor each represent and
warrant that each has been represented by an attorney of its choice and is fully
aware of the terms contained in this Agreement and AMENDED AND RESTATED RIDER A
to which it is a party which was voluntarily entered into without coercion or
duress of any kind.
12. Radnet represents and warrants to USBPS on behalf of the
Noteholders and Trustee that all necessary actions on the part of Radnet to be
taken in connection with the execution, delivery and performance of this
Agreement have been taken; the performance by Radnet of this Agreement and the
AMENDED AND RESTATED RIDER A will not violate any of
6
#1231-045
Radnet's Articles of Incorporation, Articles of Formation, Partnership Agreement
or other agreement or law by which Radnet is bound.
13. Any notice, request, direction, consent, approval, waiver
or other communication required or permitted under this Agreement to be sent
must be in writing and will become effective only upon delivery to USBPS at the
address set forth herein as follows:
U.S. Bank Portfolio Services
0000 Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxx, XX 00000
Attn: Xxxx Xxx, Director of Operations
14. Except as provided herein, and in the AMENDED AND RESTATED
RIDER A, all of the other provisions of the Loan Documents not restated will
remain in effect.
15. This Agreement and the documents referenced herein
constitute the entire and final agreement among the parties with respect to the
subject matter hereof and there are no agreements, understandings, warranties or
representations among the parties with respect to these matters except as set
forth herein.
16. This Agreement will inure to the benefit of and bind the
parties and their respective successors and permitted assigns.
17. Neither this Agreement nor any of the provisions hereof
can be changed, waived, discharged or terminated except by an instrument in
writing signed by the parties against whom such enforcement of the change,
waiver, discharge or termination is sought.
18. This Agreement will be interpreted and construed under the
laws of the Commonwealth of Pennsylvania, regardless of the domicile of any
party and will be considered to have been made, executed and performed in
Pennsylvania.
7
#1231-045
19. THE UNDERSIGNED, AND SUBJECT TO THE PROVISIONS CONTAINED
HEREIN, USBPS FOR ITSELF AND AS AGENT FOR THE TRUSTEE, (A) AGREE TO SUBMIT FOR
THEMSELVES, IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT AND ANY
SCHEDULE OR FOR RECOGNITION AND ENFORCEMENT OF ANY JUDGMENT IN RESPECT HEREOF OR
THEREOF, TO THE EXCLUSIVE JURISDICTION OF THE COURTS OF THE COMONWEALTH OF
PENNSYLVANIA, THE COURTS OF THE UNITED STATES OF AMERICA FOR THE EASTERN
DISTRICT OF PENNSYLVANIA, AND APPELLATE COURTS FROM ANY THEREOF, (B) CONSENT
THAT ANY ACTION OR PROCEEDING SHALL BE BROUGHT IN SUCH COURTS, AND WAIVE ANY
OBJECTION THAT EACH MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH ACTION OR
PROCEEDING IN ANY SUCH COURT, (C) AGREE THAT SERVICE OF PROCESS OF ANY SUCH
ACTION OR PROCEEDING MAY BE EFFECTED BY CERTIFIED MAIL (OR ANY SUBSTANTIALLY
SIMILAR FORM OF MAIL), POSTAGE PREPAID, TO THE APPROPRIATE PARTY AT ITS ADDRESS
AS SET FORTH HEREIN, AND SERVICE MADE SHALL BE DEEMED TO BE COMPLETED UPON THE
EARLIER OF ACTUAL RECEIPT OR FIVE (5) DAYS AFTER THE SAME SHALL HAVE BEEN POSTED
AS AFORESAID, AND (D) AGREE THAT NOTHING HEREIN OR IN ANY EXHIBIT OR SCHEDULE
SHALL AFFECT THE RIGHT TO EFFECT SERVICE OF PROCESS IN ANY OTHER MANNER
PERMITTED BY LAW. USBPS AND THE UNDERSIGNED EACH HEREBY UNCONDITIONALLY WAIVES
ITS RIGHT TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING
OUT OF, DIRECTLY OR INDIRECTLY, THIS AGREEMENT, ANY EXHIBIT AND THE TRANSACTIONS
8
#1231-045
CONTEMPLATED HEREBY AND THEREBY, ANY OF THE RELATED DOCUMENTS, ANY DEALINGS
BETWEEN THE PARTIES HERETO RELATING TO THE SUBJECT MATTER HEREOF OR THEREOF,
AND/OR THE RELATIONSHIP THAT IS BEING ESTABLISHED BETWEEN USBPS AS AGENT FOR THE
TRUSTEE AND THE UNDERSIGNED, PROVIDED USBPS MAY IN ITS DISCRETION ENFORCE THE
TERMS OF THE FORUM SELECTION PROVISIONS IN THE LOANS.
20. Radnet, the Company and the Guarantor hereby release
USBPS, the Trustee, and the Noteholders from and against any claim, loss, or
damage arising out of the negotiation execution, and performance of the Loan or
related matters prior to the date hereof.
21. This Agreement may be executed in two or more counterparts
and each counterpart shall be deemed an original.
9
#1231-045
LYON FINANCIAL SERVICES, INC. DBA U.S.
BANK PORTFOLIO SERVICES, AS SUCCESSOR
SERVICER FOR DVI RECEIVABLES XIV, L.L.C.
AND AS AGENT FOR U.S. BANK, N.A., AS TRUSTEE
By: ________________________________________
RADNET MANAGEMENT, INC.
By: ________________________________________
ACKNOWLEDGED AND AGREED TO:
Primedex Health Systems, Inc., Guarantor
By: ____________________________________
10
#1231-044
AMENDMENT TO LOAN DOCUMENTS
---------------------------
AGREEMENT made as of June 30, 2004 ("AMENDMENT AGREEMENT" or
"AGREEMENT") by and between LYON FINANCIAL SERVICES, INC. DBA U.S. BANK
PORTFOLIO SERVICES, as Successor Servicer for DVI Receivables XII, L.L.C. and as
Agent for U.S. Bank, N.A., as Trustee, with offices at 0000 Xxxxxx Xxxxxx, Xxxxx
000, Xxxxxxxx, Xxxxxxxxx 00000 ("USBPS") and Radnet Management, Inc., a
corporation, with offices at 0000 Xxxxxx Xxxxxx, Xxx Xxxxxxx, XX 00000
("RADNET"), and such other signatories hereto.
WHEREAS, on or about Xxxxx 00, 0000, Xxxxxx executed and
delivered to DVI Financial Services Inc. ("DVI") a Loan and Security Agreement
collectively with the Schedule Number #1231-044 dated March 31, 2000 (the
"LOAN");
WHEREAS, to secure the payment of the Loan and all other
obligations of Radnet to DVI (collectively the "OBLIGATIONS"), Radnet, pursuant
to a Security Agreement dated on or about December 15, 1997 (the "SECURITY
AGREEMENT"), granted DVI a first priority security interest in certain
Collateral described therein;
WHEREAS, to further secure payment of the Note and all other
Obligations of Radnet to DVI, Radnet delivered to DVI the guarantee (the
"GUARANTEE") of Primedex Health Systems, Inc. (the "GUARANTOR") (the "GUARANTEE"
together with the Loan and ancillary documents are, collectively the "LOAN
DOCUMENTS");
WHEREAS, substantially contemporaneously therewith, DVI
contributed all of the Loan Documents to DVI Receivables XII, L.L.C. ("DVI XII")
and thereafter pursuant to an Amended and Restated Indenture, DVI XII granted a
first priority security interest in and pledged all of the Loan Documents in
favor of U.S. Bank, N.A., as Trustee, for the benefit of a
#1231-044
noteholder which purchased asset backed promissory notes issued by DVI XII (the
"Noteholder");
WHEREAS, DVI contributed other Loans with Radnet or certain
affiliates of Radnet to this and other DVI securitizations (collectively the
"RELATED LOANS");
WHEREAS, Radnet is in default under the terms of the Loan;
WHEREAS, Radnet has requested USBPS to modify the Loan to
reflect an adjustment in payments;
WHEREAS, Radnet and/or certain of its affiliates have agreed
to modify the Related Loans;
WHEREAS, Radnet and certain of its affiliates are engaged in
negotiations to restructure or modify certain loan agreements, loans and
promissory notes with each of General Electric Capital Corporation ("GECC") and
DVI (with respect to GECC, the "GECC MODIFICATION", and with respect to DVI, the
"DVI MODIFICATION");
WHEREAS, subject to the following terms and conditions, USBPS
is willing to modify the Loan as hereinafter provided.
NOW, THEREFORE, the parties agree as follows:
1. All of the Whereas clauses are incorporated herein as if
hereinafter set forth at full length.
2. Radnet acknowledges that it is duly indebted to the Trustee
in the sum set forth on AMENDED AND RESTATED RIDER A annexed hereto, and has no
defenses, counterclaims or offsets to such indebtedness.
3. USBPS as Agent for the Trustee will modify the Loan to
provide for payments to commence in accordance with the attached revised payment
schedule (the
2
#1231-044
"AMENDED AND RESTATED RIDER A"). Radnet may, at any time, prepay all of the then
outstanding Obligations subject to an additional prepayment fee of 2% of such
Obligations. Partial prepayments of the Obligations shall not be permitted at
any time.
4. This Agreement shall become effective upon the date that
USBPS receives this Agreement duly executed by Radnet and the satisfaction of
each of the following conditions:
(a) Radnet and/or its affiliates shall have entered
into agreements on similar terms to this Agreement and
otherwise in form and substance satisfactory to USBPS,
relating to the Related Loans (the "Related Loan
Modifications");
(b) reimbursement of USBPS's legal fees incurred in
connection with the execution of this Agreement and the
Related Loan Modifications, aggregating $50,000, shall have
been received by USBPS;
(c) Radnet and/or its affiliates shall have entered
into the GECC Modification and the DVI Modification.
5. The closing of the restructuring of the Radnet Loan is
further subject to delivery to USBPS of all of the following, each in form and
substance satisfactory to USBPS and its counsel:
(a) The executed AMENDED AND RESTATED RIDER A;
(b) An executed copy of this Agreement;
(c) Such other documents, including UCC financing
statements as USBPS reasonably requests.
6. Radnet hereby acknowledges and agrees that it has no, and
will not assert any, defenses, counterclaims or offsets to the Loan and AMENDED
AND RESTATED RIDER A and acknowledges and agrees that the Trustee holds a
first-priority security interest in the Collateral.
7. Any default or other breach of any obligation under the
GECC Modification, the DVI Modification, or any of the Related Loan
Modifications shall constitute a
3
#1231-044
default under the Loan as modified by this Agreement, and USBPS shall have all
remedies thereunder.
8. Radnet hereby releases the Noteholder, USBPS individually
and as agent for the Trustee and the special purpose entities for which the
Trustee holds collateral, from and against any claims, loss or damage of any
kind or nature arising out of the Loan.
9. So long as any of the Obligations remain outstanding,
Radnet Management, Inc. (the "COMPANY") agrees as follows:
(i) FINANCIAL REPORTING. The Company shall furnish
the following documents or information to USBPS:
(A) Within 30 days after the end of each
Fiscal Quarter (as defined below) (i) (or 90 days in respect of the last month
of the fiscal year), the Company's consolidated, consolidating and on a center
by center basis, financial statements, including the most recent annual report,
balance sheet (not on a center by center basis) and income statement, prepared
in accordance with generally accepted accounting principles, which reports, the
Company warrants, shall fully and fairly represent the true financial condition
of the Company and (ii) updated projections for the Company and for each center;
(B) any other financial information normally
provided by the Company to the public; and
(C) Such other financial data or information
relative to this Amendment Agreement, including, without limitation, listings of
serial numbers or other identification data and confirmations of such
information, as USBPS may time-to-time reasonably request.
(ii) NO AMENDMENTS. Subsequent to the date of this
Amendment Agreement, the Company will not agree or consent to any amendments or
modifications to any agreement between the Company and DVI, GECC or Xxxxx Fargo
Foothill, Inc. ("FOOTHILL") containing terms (including, but not limited to,
increasing interest rates, accelerating the principal amortization or maturity,
new or more stringent defaults, additional collateral, and new remedies
provisions) that would be more onerous to the Company, or adversely impact or
affect GECC with respect to the terms of this Amendment Agreement.
(iii) DISTRIBUTIONS. The Company shall not make any
distribution or declare or pay any dividends (in cash or other property, other
than common stock) on, or purchase, acquire, redeem, or retire any of the
Company's stock, of any class, whether now or hereafter outstanding
(collectively, "DISTRIBUTIONS"); PROVIDED, HOWEVER, that so long as no
4
#1231-044
default shall have occurred and be continuing immediately prior to or after
giving effect to any such payment, (a) the Company may make Distributions to
Primedex Health Systems, Inc., a New York corporation (the "PARENT") (1) in
amounts necessary to pay customary expenses of Parent in the ordinary course of
its business as a public holding company (including salaries and related
reasonable and customary expenses incurred by employees of Parent) in an
aggregate amount not to exceed $750,000 in any fiscal year, (2) in amounts
necessary to enable Parent to pay taxes when due and owing by it in the ordinary
course of its business as a holding company and (3) in amounts necessary to
enable Parent to pay interest on those certain 11.5% Series A Convertible
Subordinated Notes due June 30, 2008, issued by Parent on June 25, 1993, and (b)
Parent may make Distributions in the form of common stock.
(iv) FIXED CHARGE COVERAGE RATIO. Commencing April
30, 2005, the Company shall not permit the Fixed Charge Coverage Ratio, (a) to
be less than 1.0:1 as of the end of each April, July, October and January (each,
a "FISCAL QUARTER") ending prior to January 1, 2007, and (b) to be less than
1.05:1 as of the last day of each Fiscal Quarter ending thereafter. "FIXED
CHARGE COVERAGE RATIO" means for any period, the ratio of (i) EBITDA for such
period minus cash capital expenditures made (to the extent not already incurred
in a prior period) or incurred during such period, to (ii) the sum of (a)
interest expense, (b) principal payments required to be paid during such period
in respect of indebtedness, and (c) all federal, state, and local income taxes
accrued, all as determined for the twelve months ending on the determination
date for the Company and its subsidiaries on a consolidated basis without
duplication and in accordance with generally accepted accounting principles
consistently applied. "EBITDA" means, with respect to any fiscal period, the
Company's and its subsidiaries' consolidated net earnings (or loss), minus
extraordinary gains and interest income, plus interest expense, income taxes,
and depreciation and amortization for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(v) LEVERAGE RATIO. The Company shall not permit the
Leverage Ratio, as determined as of the end of each Fiscal Quarter, to be
greater than the amount set forth in the following table for the Fiscal Quarters
ending in the period set forth opposite thereto:
LEVERAGE RATIO PERIOD
-------------- ------
4.50:1.0 04/30/05 - 10/30/05
4.30:1.0 10/31/05 - 10/30/06
4.00:1.0 10/31/06 - 10/30/07
3.80:1.0 10/31/07 - 10/30/08
"LEVERAGE RATIO" means, at any date of determination, the
ratio of (a) Total Debt at such date to (b) EBITDA for the applicable period
ending on such date. "TOTAL DEBT" means, as of any date of determination,
without duplication, the sum of (a) the outstanding aggregate amount of the
obligations for borrowed money, (b) the outstanding principal amount of capital
leases, (c) the outstanding principal amount of purchase money indebtedness, (d)
the outstanding principal amount of funded debt, and (e) the outstanding
principal amount of all obligations
5
#1231-044
owing to GECC, DVI and USBPS; all as determined for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(vi) EBITDA MARGIN. The Company shall not permit the
EBITDA Margin to be less than 25% as of the end of any Fiscal Quarter ending on
or after April 30, 2005. "EBITDA MARGIN" means for any period, the ratio of (a)
EBITDA for such period, to (b) net revenues (excluding the professional service
fee component of radiology services) for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(vii) RECEIVABLE DAYS. The Company shall not permit
the Receivable Days to exceed 65 days as of the end of any Fiscal Quarter ending
on or after April 30, 2005. "RECEIVABLE DAYS" means for any period, a number
equal to (a) 365 divided by (b) the result of (i) net revenues for such period
divided by (ii) net receivables for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(viii) NAME CHANGES, ETC. The Company agrees that it
shall not change its name or jurisdiction of organization without giving 30 days
prior written notice to USBPS.
10. To induce USBPS on behalf of the Trustee to enter this
Agreement, the Guarantor hereby affirms and restates its Guarantee as related to
this Loan and AMENDED AND RESTATED RIDER A.
11. Radnet, the Company and the Guarantor each represent and
warrant that each has been represented by an attorney of its choice and is fully
aware of the terms contained in this Agreement and AMENDED AND RESTATED RIDER A
to which it is a party which was voluntarily entered into without coercion or
duress of any kind.
12. Radnet represents and warrants to USBPS on behalf of the
Noteholders and Trustee that all necessary actions on the part of Radnet to be
taken in connection with the execution, delivery and performance of this
Agreement have been taken; the performance by Radnet of this Agreement and the
AMENDED AND RESTATED RIDER A will not violate any of
6
#1231-044
Radnet's Articles of Incorporation, Articles of Formation, Partnership Agreement
or other agreement or law by which Radnet is bound.
13. Any notice, request, direction, consent, approval, waiver
or other communication required or permitted under this Agreement to be sent
must be in writing and will become effective only upon delivery to USBPS at the
address set forth herein as follows:
U.S. Bank Portfolio Services
0000 Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxx, XX 00000
Attn: Xxxx Xxx, Director of Operations
14. Except as provided herein, and in the AMENDED AND RESTATED
RIDER A, all of the other provisions of the Loan Documents not restated will
remain in effect.
15. This Agreement and the documents referenced herein
constitute the entire and final agreement among the parties with respect to the
subject matter hereof and there are no agreements, understandings, warranties or
representations among the parties with respect to these matters except as set
forth herein.
16. This Agreement will inure to the benefit of and bind the
parties and their respective successors and permitted assigns.
17. Neither this Agreement nor any of the provisions hereof
can be changed, waived, discharged or terminated except by an instrument in
writing signed by the parties against whom such enforcement of the change,
waiver, discharge or termination is sought.
18. This Agreement will be interpreted and construed under the
laws of the Commonwealth of Pennsylvania, regardless of the domicile of any
party and will be considered to have been made, executed and performed in
Pennsylvania.
7
#1231-044
19. THE UNDERSIGNED, AND SUBJECT TO THE PROVISIONS CONTAINED
HEREIN, USBPS FOR ITSELF AND AS AGENT FOR THE TRUSTEE, (A) AGREE TO SUBMIT FOR
THEMSELVES, IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT AND ANY
SCHEDULE OR FOR RECOGNITION AND ENFORCEMENT OF ANY JUDGMENT IN RESPECT HEREOF OR
THEREOF, TO THE EXCLUSIVE JURISDICTION OF THE COURTS OF THE COMONWEALTH OF
PENNSYLVANIA, THE COURTS OF THE UNITED STATES OF AMERICA FOR THE EASTERN
DISTRICT OF PENNSYLVANIA, AND APPELLATE COURTS FROM ANY THEREOF, (B) CONSENT
THAT ANY ACTION OR PROCEEDING SHALL BE BROUGHT IN SUCH COURTS, AND WAIVE ANY
OBJECTION THAT EACH MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH ACTION OR
PROCEEDING IN ANY SUCH COURT, (C) AGREE THAT SERVICE OF PROCESS OF ANY SUCH
ACTION OR PROCEEDING MAY BE EFFECTED BY CERTIFIED MAIL (OR ANY SUBSTANTIALLY
SIMILAR FORM OF MAIL), POSTAGE PREPAID, TO THE APPROPRIATE PARTY AT ITS ADDRESS
AS SET FORTH HEREIN, AND SERVICE MADE SHALL BE DEEMED TO BE COMPLETED UPON THE
EARLIER OF ACTUAL RECEIPT OR FIVE (5) DAYS AFTER THE SAME SHALL HAVE BEEN POSTED
AS AFORESAID, AND (D) AGREE THAT NOTHING HEREIN OR IN ANY EXHIBIT OR SCHEDULE
SHALL AFFECT THE RIGHT TO EFFECT SERVICE OF PROCESS IN ANY OTHER MANNER
PERMITTED BY LAW. USBPS AND THE UNDERSIGNED EACH HEREBY UNCONDITIONALLY WAIVES
ITS RIGHT TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING
OUT OF, DIRECTLY OR INDIRECTLY, THIS AGREEMENT, ANY EXHIBIT AND THE TRANSACTIONS
8
#1231-044
CONTEMPLATED HEREBY AND THEREBY, ANY OF THE RELATED DOCUMENTS, ANY DEALINGS
BETWEEN THE PARTIES HERETO RELATING TO THE SUBJECT MATTER HEREOF OR THEREOF,
AND/OR THE RELATIONSHIP THAT IS BEING ESTABLISHED BETWEEN USBPS AS AGENT FOR THE
TRUSTEE AND THE UNDERSIGNED, PROVIDED USBPS MAY IN ITS DISCRETION ENFORCE THE
TERMS OF THE FORUM SELECTION PROVISIONS IN THE LOANS.
20. Radnet, the Company and the Guarantor hereby release
USBPS, the Trustee, and the Noteholders from and against any claim, loss, or
damage arising out of the negotiation execution, and performance of the Loan or
related matters prior to the date hereof.
21. This Agreement may be executed in two or more counterparts
and each counterpart shall be deemed an original.
9
#1231-044
LYON FINANCIAL SERVICES, INC. DBA U.S.
BANK PORTFOLIO SERVICES, AS SUCCESSOR
SERVICER FOR DVI RECEIVABLES XII, L.L.C.
AND AS AGENT FOR U.S. BANK, N.A., AS TRUSTEE
By: ________________________________________
RADNET MANAGEMENT, INC.
By: ________________________________________
ACKNOWLEDGED AND AGREED TO:
Primedex Health Systems, Inc., Guarantor
By: ____________________________________
10
#1231-043
AMENDMENT TO LOAN DOCUMENTS
---------------------------
AGREEMENT made as of June 30, 2004 ("AMENDMENT AGREEMENT" or
"AGREEMENT") by and between LYON FINANCIAL SERVICES, INC. DBA U.S. BANK
PORTFOLIO SERVICES, as Successor Servicer for DVI Receivables XII, L.L.C. and as
Agent for U.S. Bank, N.A., as Trustee, with offices at 0000 Xxxxxx Xxxxxx, Xxxxx
000, Xxxxxxxx, Xxxxxxxxx 00000 ("USBPS") and Radnet Management, Inc., a
corporation, with offices at 0000 Xxxxxx Xxxxxx, Xxx Xxxxxxx, XX 00000
("RADNET"), and such other signatories hereto.
WHEREAS, on or about Xxxxx 00, 0000, Xxxxxx executed and
delivered to DVI Financial Services Inc. ("DVI") a Loan and Security Agreement
collectively with the Schedule Number #1231-043 dated March 31, 2000 (the
"LOAN");
WHEREAS, to secure the payment of the Loan and all other
obligations of Radnet to DVI (collectively the "OBLIGATIONS"), Radnet, pursuant
to a Security Agreement dated on or about December 15, 1997 (the "SECURITY
AGREEMENT"), granted DVI a first priority security interest in certain
Collateral described therein;
WHEREAS, to further secure payment of the Note and all other
Obligations of Radnet to DVI, Radnet delivered to DVI the guarantee (the
"GUARANTEE") of Primedex Health Systems, Inc. (the "GUARANTOR") (the "GUARANTEE"
together with the Loan and ancillary documents are, collectively the "LOAN
DOCUMENTS");
WHEREAS, substantially contemporaneously therewith, DVI
contributed all of the Loan Documents to DVI Receivables XII, L.L.C. ("DVI XII")
and thereafter pursuant to an Amended and Restated Indenture, DVI XII granted a
first priority security interest in and pledged all of the Loan Documents in
favor of U.S. Bank, N.A., as Trustee, for the benefit of a
#1231-043
noteholder which purchased asset backed promissory notes issued by DVI XII (the
"Noteholder");
WHEREAS, DVI contributed other Loans with Radnet or certain
affiliates of Radnet to this and other DVI securitizations (collectively the
"RELATED LOANS");
WHEREAS, Radnet is in default under the terms of the Loan;
WHEREAS, Radnet has requested USBPS to modify the Loan to
reflect an adjustment in payments;
WHEREAS, Radnet and/or certain of its affiliates have agreed
to modify the Related Loans;
WHEREAS, Radnet and certain of its affiliates are engaged in
negotiations to restructure or modify certain loan agreements, loans and
promissory notes with each of General Electric Capital Corporation ("GECC") and
DVI (with respect to GECC, the "GECC MODIFICATION", and with respect to DVI, the
"DVI MODIFICATION");
WHEREAS, subject to the following terms and conditions, USBPS
is willing to modify the Loan as hereinafter provided.
NOW, THEREFORE, the parties agree as follows:
1. All of the Whereas clauses are incorporated herein as if
hereinafter set forth at full length.
2. Radnet acknowledges that it is duly indebted to the Trustee
in the sum set forth on AMENDED AND RESTATED RIDER A annexed hereto, and has no
defenses, counterclaims or offsets to such indebtedness.
3. USBPS as Agent for the Trustee will modify the Loan to
provide for payments to commence in accordance with the attached revised payment
schedule (the
2
#1231-043
"AMENDED AND RESTATED RIDER A"). Radnet may, at any time, prepay all of the then
outstanding Obligations subject to an additional prepayment fee of 2% of such
Obligations. Partial prepayments of the Obligations shall not be permitted at
any time.
4. This Agreement shall become effective upon the date that
USBPS receives this Agreement duly executed by Radnet and the satisfaction of
each of the following conditions:
(a) Radnet and/or its affiliates shall have entered
into agreements on similar terms to this Agreement and
otherwise in form and substance satisfactory to USBPS,
relating to the Related Loans (the "Related Loan
Modifications");
(b) reimbursement of USBPS's legal fees incurred in
connection with the execution of this Agreement and the
Related Loan Modifications, aggregating $50,000, shall have
been received by USBPS;
(c) Radnet and/or its affiliates shall have entered
into the GECC Modification and the DVI Modification.
5. The closing of the restructuring of the Radnet Loan is
further subject to delivery to USBPS of all of the following, each in form and
substance satisfactory to USBPS and its counsel:
(a) The executed AMENDED AND RESTATED RIDER A;
(b) An executed copy of this Agreement;
(c) Such other documents, including UCC financing
statements as USBPS reasonably requests.
6. Radnet hereby acknowledges and agrees that it has no, and
will not assert any, defenses, counterclaims or offsets to the Loan and AMENDED
AND RESTATED RIDER A and acknowledges and agrees that the Trustee holds a
first-priority security interest in the Collateral.
7. Any default or other breach of any obligation under the
GECC Modification, the DVI Modification, or any of the Related Loan
Modifications shall constitute a
3
#1231-043
default under the Loan as modified by this Agreement, and USBPS shall have all
remedies thereunder.
8. Radnet hereby releases the Noteholder, USBPS individually
and as agent for the Trustee and the special purpose entities for which the
Trustee holds collateral, from and against any claims, loss or damage of any
kind or nature arising out of the Loan.
9. So long as any of the Obligations remain outstanding,
Radnet Management, Inc. (the "COMPANY") agrees as follows:
(i) FINANCIAL REPORTING. The Company shall furnish
the following documents or information to USBPS:
(A) Within 30 days after the end of each
Fiscal Quarter (as defined below) (i) (or 90 days in respect of the last month
of the fiscal year), the Company's consolidated, consolidating and on a center
by center basis, financial statements, including the most recent annual report,
balance sheet (not on a center by center basis) and income statement, prepared
in accordance with generally accepted accounting principles, which reports, the
Company warrants, shall fully and fairly represent the true financial condition
of the Company and (ii) updated projections for the Company and for each center;
(B) any other financial information normally
provided by the Company to the public; and
(C) Such other financial data or information
relative to this Amendment Agreement, including, without limitation, listings of
serial numbers or other identification data and confirmations of such
information, as USBPS may time-to-time reasonably request.
(ii) NO AMENDMENTS. Subsequent to the date of this
Amendment Agreement, the Company will not agree or consent to any amendments or
modifications to any agreement between the Company and DVI, GECC or Xxxxx Fargo
Foothill, Inc. ("FOOTHILL") containing terms (including, but not limited to,
increasing interest rates, accelerating the principal amortization or maturity,
new or more stringent defaults, additional collateral, and new remedies
provisions) that would be more onerous to the Company, or adversely impact or
affect GECC with respect to the terms of this Amendment Agreement.
(iii) DISTRIBUTIONS. The Company shall not make any
distribution or declare or pay any dividends (in cash or other property, other
than common stock) on, or purchase, acquire, redeem, or retire any of the
Company's stock, of any class, whether now or hereafter outstanding
(collectively, "DISTRIBUTIONS"); PROVIDED, HOWEVER, that so long as no
4
#1231-043
default shall have occurred and be continuing immediately prior to or after
giving effect to any such payment, (a) the Company may make Distributions to
Primedex Health Systems, Inc., a New York corporation (the "PARENT") (1) in
amounts necessary to pay customary expenses of Parent in the ordinary course of
its business as a public holding company (including salaries and related
reasonable and customary expenses incurred by employees of Parent) in an
aggregate amount not to exceed $750,000 in any fiscal year, (2) in amounts
necessary to enable Parent to pay taxes when due and owing by it in the ordinary
course of its business as a holding company and (3) in amounts necessary to
enable Parent to pay interest on those certain 11.5% Series A Convertible
Subordinated Notes due June 30, 2008, issued by Parent on June 25, 1993, and (b)
Parent may make Distributions in the form of common stock.
(iv) FIXED CHARGE COVERAGE RATIO. Commencing April
30, 2005, the Company shall not permit the Fixed Charge Coverage Ratio, (a) to
be less than 1.0:1 as of the end of each April, July, October and January (each,
a "FISCAL QUARTER") ending prior to January 1, 2007, and (b) to be less than
1.05:1 as of the last day of each Fiscal Quarter ending thereafter. "FIXED
CHARGE COVERAGE RATIO" means for any period, the ratio of (i) EBITDA for such
period minus cash capital expenditures made (to the extent not already incurred
in a prior period) or incurred during such period, to (ii) the sum of (a)
interest expense, (b) principal payments required to be paid during such period
in respect of indebtedness, and (c) all federal, state, and local income taxes
accrued, all as determined for the twelve months ending on the determination
date for the Company and its subsidiaries on a consolidated basis without
duplication and in accordance with generally accepted accounting principles
consistently applied. "EBITDA" means, with respect to any fiscal period, the
Company's and its subsidiaries' consolidated net earnings (or loss), minus
extraordinary gains and interest income, plus interest expense, income taxes,
and depreciation and amortization for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(v) LEVERAGE RATIO. The Company shall not permit the
Leverage Ratio, as determined as of the end of each Fiscal Quarter, to be
greater than the amount set forth in the following table for the Fiscal Quarters
ending in the period set forth opposite thereto:
LEVERAGE RATIO PERIOD
-------------- ------
4.50:1.0 04/30/05 - 10/30/05
4.30:1.0 10/31/05 - 10/30/06
4.00:1.0 10/31/06 - 10/30/07
3.80:1.0 10/31/07 - 10/30/08
"LEVERAGE RATIO" means, at any date of determination, the
ratio of (a) Total Debt at such date to (b) EBITDA for the applicable period
ending on such date. "TOTAL DEBT" means, as of any date of determination,
without duplication, the sum of (a) the outstanding aggregate amount of the
obligations for borrowed money, (b) the outstanding principal amount of capital
leases, (c) the outstanding principal amount of purchase money indebtedness, (d)
the outstanding principal amount of funded debt, and (e) the outstanding
principal amount of all obligations
5
#1231-043
owing to GECC, DVI and USBPS; all as determined for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(vi) EBITDA MARGIN. The Company shall not permit the
EBITDA Margin to be less than 25% as of the end of any Fiscal Quarter ending on
or after April 30, 2005. "EBITDA MARGIN" means for any period, the ratio of (a)
EBITDA for such period, to (b) net revenues (excluding the professional service
fee component of radiology services) for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(vii) RECEIVABLE DAYS. The Company shall not permit
the Receivable Days to exceed 65 days as of the end of any Fiscal Quarter ending
on or after April 30, 2005. "RECEIVABLE DAYS" means for any period, a number
equal to (a) 365 divided by (b) the result of (i) net revenues for such period
divided by (ii) net receivables for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(viii) NAME CHANGES, ETC. The Company agrees that it
shall not change its name or jurisdiction of organization without giving 30 days
prior written notice to USBPS.
10. To induce USBPS on behalf of the Trustee to enter this
Agreement, the Guarantor hereby affirms and restates its Guarantee as related to
this Loan and AMENDED AND RESTATED RIDER A.
11. Radnet, the Company and the Guarantor each represent and
warrant that each has been represented by an attorney of its choice and is fully
aware of the terms contained in this Agreement and AMENDED AND RESTATED RIDER A
to which it is a party which was voluntarily entered into without coercion or
duress of any kind.
12. Radnet represents and warrants to USBPS on behalf of the
Noteholders and Trustee that all necessary actions on the part of Radnet to be
taken in connection with the execution, delivery and performance of this
Agreement have been taken; the performance by Radnet of this Agreement and the
AMENDED AND RESTATED RIDER A will not violate any of
6
#1231-043
Radnet's Articles of Incorporation, Articles of Formation, Partnership Agreement
or other agreement or law by which Radnet is bound.
13. Any notice, request, direction, consent, approval, waiver
or other communication required or permitted under this Agreement to be sent
must be in writing and will become effective only upon delivery to USBPS at the
address set forth herein as follows:
U.S. Bank Portfolio Services
0000 Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxx, XX 00000
Attn: Xxxx Xxx, Director of Operations
14. Except as provided herein, and in the AMENDED AND RESTATED
RIDER A, all of the other provisions of the Loan Documents not restated will
remain in effect.
15. This Agreement and the documents referenced herein
constitute the entire and final agreement among the parties with respect to the
subject matter hereof and there are no agreements, understandings, warranties or
representations among the parties with respect to these matters except as set
forth herein.
16. This Agreement will inure to the benefit of and bind the
parties and their respective successors and permitted assigns.
17. Neither this Agreement nor any of the provisions hereof
can be changed, waived, discharged or terminated except by an instrument in
writing signed by the parties against whom such enforcement of the change,
waiver, discharge or termination is sought.
18. This Agreement will be interpreted and construed under the
laws of the Commonwealth of Pennsylvania, regardless of the domicile of any
party and will be considered to have been made, executed and performed in
Pennsylvania.
7
#1231-043
19. THE UNDERSIGNED, AND SUBJECT TO THE PROVISIONS CONTAINED
HEREIN, USBPS FOR ITSELF AND AS AGENT FOR THE TRUSTEE, (A) AGREE TO SUBMIT FOR
THEMSELVES, IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT AND ANY
SCHEDULE OR FOR RECOGNITION AND ENFORCEMENT OF ANY JUDGMENT IN RESPECT HEREOF OR
THEREOF, TO THE EXCLUSIVE JURISDICTION OF THE COURTS OF THE COMONWEALTH OF
PENNSYLVANIA, THE COURTS OF THE UNITED STATES OF AMERICA FOR THE EASTERN
DISTRICT OF PENNSYLVANIA, AND APPELLATE COURTS FROM ANY THEREOF, (B) CONSENT
THAT ANY ACTION OR PROCEEDING SHALL BE BROUGHT IN SUCH COURTS, AND WAIVE ANY
OBJECTION THAT EACH MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH ACTION OR
PROCEEDING IN ANY SUCH COURT, (C) AGREE THAT SERVICE OF PROCESS OF ANY SUCH
ACTION OR PROCEEDING MAY BE EFFECTED BY CERTIFIED MAIL (OR ANY SUBSTANTIALLY
SIMILAR FORM OF MAIL), POSTAGE PREPAID, TO THE APPROPRIATE PARTY AT ITS ADDRESS
AS SET FORTH HEREIN, AND SERVICE MADE SHALL BE DEEMED TO BE COMPLETED UPON THE
EARLIER OF ACTUAL RECEIPT OR FIVE (5) DAYS AFTER THE SAME SHALL HAVE BEEN POSTED
AS AFORESAID, AND (D) AGREE THAT NOTHING HEREIN OR IN ANY EXHIBIT OR SCHEDULE
SHALL AFFECT THE RIGHT TO EFFECT SERVICE OF PROCESS IN ANY OTHER MANNER
PERMITTED BY LAW. USBPS AND THE UNDERSIGNED EACH HEREBY UNCONDITIONALLY WAIVES
ITS RIGHT TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING
OUT OF, DIRECTLY OR INDIRECTLY, THIS AGREEMENT, ANY EXHIBIT AND THE TRANSACTIONS
8
#1231-043
CONTEMPLATED HEREBY AND THEREBY, ANY OF THE RELATED DOCUMENTS, ANY DEALINGS
BETWEEN THE PARTIES HERETO RELATING TO THE SUBJECT MATTER HEREOF OR THEREOF,
AND/OR THE RELATIONSHIP THAT IS BEING ESTABLISHED BETWEEN USBPS AS AGENT FOR THE
TRUSTEE AND THE UNDERSIGNED, PROVIDED USBPS MAY IN ITS DISCRETION ENFORCE THE
TERMS OF THE FORUM SELECTION PROVISIONS IN THE LOANS.
20. Radnet, the Company and the Guarantor hereby release
USBPS, the Trustee, and the Noteholders from and against any claim, loss, or
damage arising out of the negotiation execution, and performance of the Loan or
related matters prior to the date hereof.
21. This Agreement may be executed in two or more counterparts
and each counterpart shall be deemed an original.
9
#1231-043
LYON FINANCIAL SERVICES, INC. DBA U.S.
BANK PORTFOLIO SERVICES, AS SUCCESSOR
SERVICER FOR DVI RECEIVABLES XII, L.L.C.
AND AS AGENT FOR U.S. BANK, N.A., AS TRUSTEE
By: ________________________________________
RADNET MANAGEMENT, INC.
By: ________________________________________
ACKNOWLEDGED AND AGREED TO:
Primedex Health Systems, Inc., Guarantor
By: ____________________________________
10
#1231-042
AMENDMENT TO LOAN DOCUMENTS
---------------------------
AGREEMENT made as of June 30, 2004 ("AMENDMENT AGREEMENT" or
"AGREEMENT") by and between LYON FINANCIAL SERVICES, INC. DBA U.S. BANK
PORTFOLIO SERVICES, as Successor Servicer for DVI Receivables XII, L.L.C. and as
Agent for U.S. Bank, N.A., as Trustee, with offices at 0000 Xxxxxx Xxxxxx, Xxxxx
000, Xxxxxxxx, Xxxxxxxxx 00000 ("USBPS") and Radnet Management, Inc., a
corporation, with offices at 0000 Xxxxxx Xxxxxx, Xxx Xxxxxxx, XX 00000
("RADNET"), and such other signatories hereto.
WHEREAS, on or about Xxxxx 00, 0000, Xxxxxx executed and
delivered to DVI Financial Services Inc. ("DVI") a Loan and Security Agreement
collectively with the Schedule Number #1231-042 dated March 31, 2000 (the
"LOAN");
WHEREAS, to secure the payment of the Loan and all other
obligations of Radnet to DVI (collectively the "OBLIGATIONS"), Radnet, pursuant
to a Security Agreement dated on or about December 15, 1997 (the "SECURITY
AGREEMENT"), granted DVI a first priority security interest in certain
Collateral described therein;
WHEREAS, to further secure payment of the Note and all other
Obligations of Radnet to DVI, Radnet delivered to DVI the guarantee (the
"GUARANTEE") of Primedex Health Systems, Inc. (the "GUARANTOR") (the "GUARANTEE"
together with the Loan and ancillary documents are, collectively the "LOAN
DOCUMENTS");
WHEREAS, substantially contemporaneously therewith, DVI
contributed all of the Loan Documents to DVI Receivables XII, L.L.C. ("DVI XII")
and thereafter pursuant to an Amended and Restated Indenture, DVI XII granted a
first priority security interest in and pledged all of the Loan Documents in
favor of U.S. Bank, N.A., as Trustee, for the benefit of a
#1231-042
noteholder which purchased asset backed promissory notes issued by DVI XII (the
"Noteholder");
WHEREAS, DVI contributed other Loans with Radnet or certain
affiliates of Radnet to this and other DVI securitizations (collectively the
"RELATED LOANS");
WHEREAS, Radnet is in default under the terms of the Loan;
WHEREAS, Radnet has requested USBPS to modify the Loan to
reflect an adjustment in payments;
WHEREAS, Radnet and/or certain of its affiliates have agreed
to modify the Related Loans;
WHEREAS, Radnet and certain of its affiliates are engaged in
negotiations to restructure or modify certain loan agreements, loans and
promissory notes with each of General Electric Capital Corporation ("GECC") and
DVI (with respect to GECC, the "GECC MODIFICATION", and with respect to DVI, the
"DVI MODIFICATION");
WHEREAS, subject to the following terms and conditions, USBPS
is willing to modify the Loan as hereinafter provided.
NOW, THEREFORE, the parties agree as follows:
1. All of the Whereas clauses are incorporated herein as if
hereinafter set forth at full length.
2. Radnet acknowledges that it is duly indebted to the Trustee
in the sum set forth on AMENDED AND RESTATED RIDER A annexed hereto, and has no
defenses, counterclaims or offsets to such indebtedness.
3. USBPS as Agent for the Trustee will modify the Loan to
provide for payments to commence in accordance with the attached revised payment
schedule (the
2
#1231-042
"AMENDED AND RESTATED RIDER A"). Radnet may, at any time, prepay all of the then
outstanding Obligations subject to an additional prepayment fee of 2% of such
Obligations. Partial prepayments of the Obligations shall not be permitted at
any time.
4. This Agreement shall become effective upon the date that
USBPS receives this Agreement duly executed by Radnet and the satisfaction of
each of the following conditions:
(a) Radnet and/or its affiliates shall have entered
into agreements on similar terms to this Agreement and
otherwise in form and substance satisfactory to USBPS,
relating to the Related Loans (the "Related Loan
Modifications");
(b) reimbursement of USBPS's legal fees incurred in
connection with the execution of this Agreement and the
Related Loan Modifications, aggregating $50,000, shall have
been received by USBPS;
(c) Radnet and/or its affiliates shall have entered
into the GECC Modification and the DVI Modification.
5. The closing of the restructuring of the Radnet Loan is
further subject to delivery to USBPS of all of the following, each in form and
substance satisfactory to USBPS and its counsel:
(a) The executed AMENDED AND RESTATED RIDER A;
(b) An executed copy of this Agreement;
(c) Such other documents, including UCC
financing statements as USBPS reasonably requests.
6. Radnet hereby acknowledges and agrees that it has no, and
will not assert any, defenses, counterclaims or offsets to the Loan and AMENDED
AND RESTATED RIDER A and acknowledges and agrees that the Trustee holds a
first-priority security interest in the Collateral.
7. Any default or other breach of any obligation under the
GECC Modification, the DVI Modification, or any of the Related Loan
Modifications shall constitute a
3
#1231-042
default under the Loan as modified by this Agreement, and USBPS shall have all
remedies thereunder.
8. Radnet hereby releases the Noteholder, USBPS individually
and as agent for the Trustee and the special purpose entities for which the
Trustee holds collateral, from and against any claims, loss or damage of any
kind or nature arising out of the Loan.
9. So long as any of the Obligations remain outstanding,
Radnet Management, Inc. (the "COMPANY") agrees as follows:
(i) FINANCIAL REPORTING. The Company shall furnish
the following documents or information to USBPS:
(A) Within 30 days after the end of each
Fiscal Quarter (as defined below) (i) (or 90 days in respect of the last month
of the fiscal year), the Company's consolidated, consolidating and on a center
by center basis, financial statements, including the most recent annual report,
balance sheet (not on a center by center basis) and income statement, prepared
in accordance with generally accepted accounting principles, which reports, the
Company warrants, shall fully and fairly represent the true financial condition
of the Company and (ii) updated projections for the Company and for each center;
(B) any other financial information normally
provided by the Company to the public; and
(C) Such other financial data or information
relative to this Amendment Agreement, including, without limitation, listings of
serial numbers or other identification data and confirmations of such
information, as USBPS may time-to-time reasonably request.
(ii) NO AMENDMENTS. Subsequent to the date of this
Amendment Agreement, the Company will not agree or consent to any amendments or
modifications to any agreement between the Company and DVI, GECC or Xxxxx Fargo
Foothill, Inc. ("FOOTHILL") containing terms (including, but not limited to,
increasing interest rates, accelerating the principal amortization or maturity,
new or more stringent defaults, additional collateral, and new remedies
provisions) that would be more onerous to the Company, or adversely impact or
affect GECC with respect to the terms of this Amendment Agreement.
(iii) DISTRIBUTIONS. The Company shall not make any
distribution or declare or pay any dividends (in cash or other property, other
than common stock) on, or purchase, acquire, redeem, or retire any of the
Company's stock, of any class, whether now or hereafter outstanding
(collectively, "DISTRIBUTIONS"); PROVIDED, HOWEVER, that so long as no
4
#1231-042
default shall have occurred and be continuing immediately prior to or after
giving effect to any such payment, (a) the Company may make Distributions to
Primedex Health Systems, Inc., a New York corporation (the "PARENT") (1) in
amounts necessary to pay customary expenses of Parent in the ordinary course of
its business as a public holding company (including salaries and related
reasonable and customary expenses incurred by employees of Parent) in an
aggregate amount not to exceed $750,000 in any fiscal year, (2) in amounts
necessary to enable Parent to pay taxes when due and owing by it in the ordinary
course of its business as a holding company and (3) in amounts necessary to
enable Parent to pay interest on those certain 11.5% Series A Convertible
Subordinated Notes due June 30, 2008, issued by Parent on June 25, 1993, and (b)
Parent may make Distributions in the form of common stock.
(iv) FIXED CHARGE COVERAGE RATIO. Commencing April
30, 2005, the Company shall not permit the Fixed Charge Coverage Ratio, (a) to
be less than 1.0:1 as of the end of each April, July, October and January (each,
a "FISCAL QUARTER") ending prior to January 1, 2007, and (b) to be less than
1.05:1 as of the last day of each Fiscal Quarter ending thereafter. "FIXED
CHARGE COVERAGE RATIO" means for any period, the ratio of (i) EBITDA for such
period MINUS cash capital expenditures made (to the extent not already incurred
in a prior period) or incurred during such period, to (ii) the sum of (a)
interest expense, (b) principal payments required to be paid during such period
in respect of indebtedness, and (c) all federal, state, and local income taxes
accrued, all as determined for the twelve months ending on the determination
date for the Company and its subsidiaries on a consolidated basis without
duplication and in accordance with generally accepted accounting principles
consistently applied. "EBITDA" means, with respect to any fiscal period, the
Company's and its subsidiaries' consolidated net earnings (or loss), minus
extraordinary gains and interest income, plus interest expense, income taxes,
and depreciation and amortization for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(v) LEVERAGE RATIO. The Company shall not permit the
Leverage Ratio, as determined as of the end of each Fiscal Quarter, to be
greater than the amount set forth in the following table for the Fiscal Quarters
ending in the period set forth opposite thereto:
LEVERAGE RATIO PERIOD
-------------- ------
4.50:1.0 04/30/05 - 10/30/05
4.30:1.0 10/31/05 - 10/30/06
4.00:1.0 10/31/06 - 10/30/07
3.80:1.0 10/31/07 - 10/30/08
"LEVERAGE RATIO" means, at any date of determination, the
ratio of (a) Total Debt at such date to (b) EBITDA for the applicable period
ending on such date. "TOTAL DEBT" means, as of any date of determination,
without duplication, the sum of (a) the outstanding aggregate amount of the
obligations for borrowed money, (b) the outstanding principal amount of capital
leases, (c) the outstanding principal amount of purchase money indebtedness, (d)
the outstanding principal amount of funded debt, and (e) the outstanding
principal amount of all obligations
5
#1231-042
owing to GECC, DVI and USBPS; all as determined for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(vi) EBITDA MARGIN. The Company shall not permit the
EBITDA Margin to be less than 25% as of the end of any Fiscal Quarter ending on
or after April 30, 2005. "EBITDA MARGIN" means for any period, the ratio of (a)
EBITDA for such period, to (b) net revenues (excluding the professional service
fee component of radiology services) for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(vii) RECEIVABLE DAYS. The Company shall not permit
the Receivable Days to exceed 65 days as of the end of any Fiscal Quarter ending
on or after April 30, 2005. "RECEIVABLE DAYS" means for any period, a number
equal to (a) 365 divided by (b) the result of (i) net revenues for such period
divided by (ii) net receivables for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(viii) NAME CHANGES, ETC. The Company agrees that it
shall not change its name or jurisdiction of organization without giving 30 days
prior written notice to USBPS.
10. To induce USBPS on behalf of the Trustee to enter this
Agreement, the Guarantor hereby affirms and restates its Guarantee as related to
this Loan and AMENDED AND RESTATED RIDER A.
11. Radnet, the Company and the Guarantor each represent and
warrant that each has been represented by an attorney of its choice and is fully
aware of the terms contained in this Agreement and AMENDED AND RESTATED RIDER A
to which it is a party which was voluntarily entered into without coercion or
duress of any kind.
12. Radnet represents and warrants to USBPS on behalf of the
Noteholders and Trustee that all necessary actions on the part of Radnet to be
taken in connection with the execution, delivery and performance of this
Agreement have been taken; the performance by Radnet of this Agreement and the
AMENDED AND RESTATED RIDER A will not violate any of
6
#1231-042
Radnet's Articles of Incorporation, Articles of Formation, Partnership Agreement
or other agreement or law by which Radnet is bound.
13. Any notice, request, direction, consent, approval, waiver
or other communication required or permitted under this Agreement to be sent
must be in writing and will become effective only upon delivery to USBPS at the
address set forth herein as follows:
U.S. Bank Portfolio Services
0000 Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxx, XX 00000
Attn: Xxxx Xxx, Director of Operations
14. Except as provided herein, and in the AMENDED AND RESTATED
RIDER A, all of the other provisions of the Loan Documents not restated will
remain in effect.
15. This Agreement and the documents referenced herein
constitute the entire and final agreement among the parties with respect to the
subject matter hereof and there are no agreements, understandings, warranties or
representations among the parties with respect to these matters except as set
forth herein.
16. This Agreement will inure to the benefit of and bind the
parties and their respective successors and permitted assigns.
17. Neither this Agreement nor any of the provisions hereof
can be changed, waived, discharged or terminated except by an instrument in
writing signed by the parties against whom such enforcement of the change,
waiver, discharge or termination is sought.
18. This Agreement will be interpreted and construed under the
laws of the Commonwealth of Pennsylvania, regardless of the domicile of any
party and will be considered to have been made, executed and performed in
Pennsylvania.
7
#1231-042
19. THE UNDERSIGNED, AND SUBJECT TO THE PROVISIONS CONTAINED
HEREIN, USBPS FOR ITSELF AND AS AGENT FOR THE TRUSTEE, (A) AGREE TO SUBMIT FOR
THEMSELVES, IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT AND ANY
SCHEDULE OR FOR RECOGNITION AND ENFORCEMENT OF ANY JUDGMENT IN RESPECT HEREOF OR
THEREOF, TO THE EXCLUSIVE JURISDICTION OF THE COURTS OF THE COMONWEALTH OF
PENNSYLVANIA, THE COURTS OF THE UNITED STATES OF AMERICA FOR THE EASTERN
DISTRICT OF PENNSYLVANIA, AND APPELLATE COURTS FROM ANY THEREOF, (B) CONSENT
THAT ANY ACTION OR PROCEEDING SHALL BE BROUGHT IN SUCH COURTS, AND WAIVE ANY
OBJECTION THAT EACH MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH ACTION OR
PROCEEDING IN ANY SUCH COURT, (C) AGREE THAT SERVICE OF PROCESS OF ANY SUCH
ACTION OR PROCEEDING MAY BE EFFECTED BY CERTIFIED MAIL (OR ANY SUBSTANTIALLY
SIMILAR FORM OF MAIL), POSTAGE PREPAID, TO THE APPROPRIATE PARTY AT ITS ADDRESS
AS SET FORTH HEREIN, AND SERVICE MADE SHALL BE DEEMED TO BE COMPLETED UPON THE
EARLIER OF ACTUAL RECEIPT OR FIVE (5) DAYS AFTER THE SAME SHALL HAVE BEEN POSTED
AS AFORESAID, AND (D) AGREE THAT NOTHING HEREIN OR IN ANY EXHIBIT OR SCHEDULE
SHALL AFFECT THE RIGHT TO EFFECT SERVICE OF PROCESS IN ANY OTHER MANNER
PERMITTED BY LAW. USBPS AND THE UNDERSIGNED EACH HEREBY UNCONDITIONALLY WAIVES
ITS RIGHT TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING
OUT OF, DIRECTLY OR INDIRECTLY, THIS AGREEMENT, ANY EXHIBIT AND THE TRANSACTIONS
8
#1231-042
CONTEMPLATED HEREBY AND THEREBY, ANY OF THE RELATED DOCUMENTS, ANY DEALINGS
BETWEEN THE PARTIES HERETO RELATING TO THE SUBJECT MATTER HEREOF OR THEREOF,
AND/OR THE RELATIONSHIP THAT IS BEING ESTABLISHED BETWEEN USBPS AS AGENT FOR THE
TRUSTEE AND THE UNDERSIGNED, PROVIDED USBPS MAY IN ITS DISCRETION ENFORCE THE
TERMS OF THE FORUM SELECTION PROVISIONS IN THE LOANS.
20. Radnet, the Company and the Guarantor hereby release
USBPS, the Trustee, and the Noteholders from and against any claim, loss, or
damage arising out of the negotiation execution, and performance of the Loan or
related matters prior to the date hereof.
21. This Agreement may be executed in two or more counterparts
and each counterpart shall be deemed an original.
9
#1231-042
LYON FINANCIAL SERVICES, INC. DBA U.S.
BANK PORTFOLIO SERVICES, AS SUCCESSOR
SERVICER FOR DVI RECEIVABLES XII, L.L.C.
AND AS AGENT FOR U.S. BANK, N.A., AS TRUSTEE
By: ________________________________________
RADNET MANAGEMENT, INC.
By: ________________________________________
ACKNOWLEDGED AND AGREED TO:
Primedex Health Systems, Inc., Guarantor
By: ____________________________________
10
#1231-041
AMENDMENT TO LOAN DOCUMENTS
---------------------------
AGREEMENT made as of June 30, 2004 ("AMENDMENT AGREEMENT" or
"AGREEMENT") by and between LYON FINANCIAL SERVICES, INC. DBA U.S. BANK
PORTFOLIO SERVICES, as Successor Servicer for DVI Receivables VIII, L.L.C. and
as Agent for U.S. Bank, N.A., as Trustee, with offices at 0000 Xxxxxx Xxxxxx,
Xxxxx 000, Xxxxxxxx, Xxxxxxxxx 00000 ("USBPS") and Radnet Management, Inc., a
corporation, with offices at 0000 Xxxxxx Xxxxxx, Xxx Xxxxxxx, XX 00000
("RADNET"), and such other signatories hereto.
WHEREAS, on or about Xxxxx 00, 0000, Xxxxxx executed and
delivered to DVI Financial Services Inc. ("DVI") a Loan and Security Agreement
collectively with the Schedule Number #1231-041 dated December 27, 1999 (the
"LOAN");
WHEREAS, to secure the payment of the Loan and all other
obligations of Radnet to DVI (collectively the "OBLIGATIONS"), Radnet, pursuant
to a Security Agreement dated on or about December 15, 1997 (the "SECURITY
AGREEMENT"), granted DVI a first priority security interest in certain
Collateral described therein;
WHEREAS, to further secure payment of the Note and all other
Obligations of Radnet to DVI, Radnet delivered to DVI the guarantee (the
"GUARANTEE") of Primedex Health Systems, Inc. (the "GUARANTOR") (the "GUARANTEE"
together with the Loan and ancillary documents are, collectively the "LOAN
DOCUMENTS");
WHEREAS, substantially contemporaneously therewith, DVI
contributed all of the Loan Documents to DVI Receivables VIII, L.L.C. ("DVI
VIII") and thereafter pursuant to an Amended and Restated Indenture, DVI VIII
granted a first priority security interest in and pledged all of the Loan
Documents in favor of U.S. Bank, N.A., as Trustee, for the benefit of a
#1231-041
noteholder which purchased asset backed promissory notes issued by DVI VIII (the
"Noteholder");
WHEREAS, DVI contributed other Loans with Radnet or certain
affiliates of Radnet to this and other DVI securitizations (collectively the
"RELATED LOANS");
WHEREAS, Radnet is in default under the terms of the Loan;
WHEREAS, Radnet has requested USBPS to modify the Loan to
reflect an adjustment in payments;
WHEREAS, Radnet and/or certain of its affiliates have agreed
to modify the Related Loans;
WHEREAS, Radnet and certain of its affiliates are engaged in
negotiations to restructure or modify certain loan agreements, loans and
promissory notes with each of General Electric Capital Corporation ("GECC") and
DVI (with respect to GECC, the "GECC MODIFICATION", and with respect to DVI, the
"DVI MODIFICATION");
WHEREAS, subject to the following terms and conditions, USBPS
is willing to modify the Loan as hereinafter provided.
NOW, THEREFORE, the parties agree as follows:
1. All of the Whereas clauses are incorporated herein as if
hereinafter set forth at full length.
2. Radnet acknowledges that it is duly indebted to the Trustee
in the sum set forth on AMENDED AND RESTATED RIDER A annexed hereto, and has no
defenses, counterclaims or offsets to such indebtedness.
3. USBPS as Agent for the Trustee will modify the Loan to
provide for payments to commence in accordance with the attached revised payment
schedule (the
2
#1231-041
"AMENDED AND RESTATED RIDER A"). Radnet may, at any time, prepay all of the then
outstanding Obligations subject to an additional prepayment fee of 2% of such
Obligations. Partial prepayments of the Obligations shall not be permitted at
any time.
4. This Agreement shall become effective upon the date that
USBPS receives this Agreement duly executed by Radnet and the satisfaction of
each of the following conditions:
(a) Radnet and/or its affiliates shall have entered
into agreements on similar terms to this Agreement and
otherwise in form and substance satisfactory to USBPS,
relating to the Related Loans (the "Related Loan
Modifications");
(b) reimbursement of USBPS's legal fees incurred in
connection with the execution of this Agreement and the
Related Loan Modifications, aggregating $50,000, shall have
been received by USBPS;
(c) Radnet and/or its affiliates shall have entered
into the GECC Modification and the DVI Modification.
5. The closing of the restructuring of the Radnet Loan is
further subject to delivery to USBPS of all of the following, each in form and
substance satisfactory to USBPS and its counsel:
(a) The executed AMENDED AND RESTATED RIDER A;
(b) An executed copy of this Agreement;
(c) Such other documents, including UCC financing
statements as USBPS reasonably requests.
6. Radnet hereby acknowledges and agrees that it has no, and
will not assert any, defenses, counterclaims or offsets to the Loan and AMENDED
AND RESTATED RIDER A and acknowledges and agrees that the Trustee holds a
first-priority security interest in the Collateral.
7. Any default or other breach of any obligation under the
GECC Modification, the DVI Modification, or any of the Related Loan
Modifications shall constitute a
3
#1231-041
default under the Loan as modified by this Agreement, and USBPS shall have all
remedies thereunder.
8. Radnet hereby releases the Noteholder, USBPS individually
and as agent for the Trustee and the special purpose entities for which the
Trustee holds collateral, from and against any claims, loss or damage of any
kind or nature arising out of the Loan.
9. So long as any of the Obligations remain outstanding,
Radnet Management, Inc. (the "COMPANY") agrees as follows:
(i) FINANCIAL REPORTING. The Company shall furnish
the following documents or information to USBPS:
(A) Within 30 days after the end of each
Fiscal Quarter (as defined below) (i) (or 90 days in respect of the last month
of the fiscal year), the Company's consolidated, consolidating and on a center
by center basis, financial statements, including the most recent annual report,
balance sheet (not on a center by center basis) and income statement, prepared
in accordance with generally accepted accounting principles, which reports, the
Company warrants, shall fully and fairly represent the true financial condition
of the Company and (ii) updated projections for the Company and for each center;
(B) any other financial information normally
provided by the Company to the public; and
(C) Such other financial data or information
relative to this Amendment Agreement, including, without limitation, listings of
serial numbers or other identification data and confirmations of such
information, as USBPS may time-to-time reasonably request.
(ii) NO AMENDMENTS. Subsequent to the date of this
Amendment Agreement, the Company will not agree or consent to any amendments or
modifications to any agreement between the Company and DVI, GECC or Xxxxx Fargo
Foothill, Inc. ("FOOTHILL") containing terms (including, but not limited to,
increasing interest rates, accelerating the principal amortization or maturity,
new or more stringent defaults, additional collateral, and new remedies
provisions) that would be more onerous to the Company, or adversely impact or
affect GECC with respect to the terms of this Amendment Agreement.
(iii) DISTRIBUTIONS. The Company shall not make any
distribution or declare or pay any dividends (in cash or other property, other
than common stock) on, or purchase, acquire, redeem, or retire any of the
Company's stock, of any class, whether now or hereafter outstanding
(collectively, "DISTRIBUTIONS"); PROVIDED, HOWEVER, that so long as no
4
#1231-041
default shall have occurred and be continuing immediately prior to or after
giving effect to any such payment, (a) the Company may make Distributions to
Primedex Health Systems, Inc., a New York corporation (the "PARENT") (1) in
amounts necessary to pay customary expenses of Parent in the ordinary course of
its business as a public holding company (including salaries and related
reasonable and customary expenses incurred by employees of Parent) in an
aggregate amount not to exceed $750,000 in any fiscal year, (2) in amounts
necessary to enable Parent to pay taxes when due and owing by it in the ordinary
course of its business as a holding company and (3) in amounts necessary to
enable Parent to pay interest on those certain 11.5% Series A Convertible
Subordinated Notes due June 30, 2008, issued by Parent on June 25, 1993, and (b)
Parent may make Distributions in the form of common stock.
(iv) FIXED CHARGE COVERAGE RATIO. Commencing April
30, 2005, the Company shall not permit the Fixed Charge Coverage Ratio, (a) to
be less than 1.0:1 as of the end of each April, July, October and January (each,
a "FISCAL QUARTER") ending prior to January 1, 2007, and (b) to be less than
1.05:1 as of the last day of each Fiscal Quarter ending thereafter. "FIXED
CHARGE COVERAGE RATIO" means for any period, the ratio of (i) EBITDA for such
period minus cash capital expenditures made (to the extent not already incurred
in a prior period) or incurred during such period, to (ii) the sum of (a)
interest expense, (b) principal payments required to be paid during such period
in respect of indebtedness, and (c) all federal, state, and local income taxes
accrued, all as determined for the twelve months ending on the determination
date for the Company and its subsidiaries on a consolidated basis without
duplication and in accordance with generally accepted accounting principles
consistently applied. "EBITDA" means, with respect to any fiscal period, the
Company's and its subsidiaries' consolidated net earnings (or loss), minus
extraordinary gains and interest income, plus interest expense, income taxes,
and depreciation and amortization for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(v) LEVERAGE RATIO. The Company shall not permit the
Leverage Ratio, as determined as of the end of each Fiscal Quarter, to be
greater than the amount set forth in the following table for the Fiscal Quarters
ending in the period set forth opposite thereto:
LEVERAGE RATIO PERIOD
-------------- ------
4.50:1.0 04/30/05 - 10/30/05
4.30:1.0 10/31/05 - 10/30/06
4.00:1.0 10/31/06 - 10/30/07
3.80:1.0 10/31/07 - 10/30/08
"LEVERAGE RATIO" means, at any date of determination, the
ratio of (a) Total Debt at such date to (b) EBITDA for the applicable period
ending on such date. "TOTAL DEBT" means, as of any date of determination,
without duplication, the sum of (a) the outstanding aggregate amount of the
obligations for borrowed money, (b) the outstanding principal amount of capital
leases, (c) the outstanding principal amount of purchase money indebtedness, (d)
the outstanding principal amount of funded debt, and (e) the outstanding
principal amount of all obligations
5
#1231-041
owing to GECC, DVI and USBPS; all as determined for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(vi) EBITDA MARGIN. The Company shall not permit the
EBITDA Margin to be less than 25% as of the end of any Fiscal Quarter ending on
or after April 30, 2005. "EBITDA MARGIN" means for any period, the ratio of (a)
EBITDA for such period, to (b) net revenues (excluding the professional service
fee component of radiology services) for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(vii) RECEIVABLE DAYS. The Company shall not permit
the Receivable Days to exceed 65 days as of the end of any Fiscal Quarter ending
on or after April 30, 2005. "RECEIVABLE DAYS" means for any period, a number
equal to (a) 365 divided by (b) the result of (i) net revenues for such period
divided by (ii) net receivables for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(viii) NAME CHANGES, ETC. The Company agrees that it
shall not change its name or jurisdiction of organization without giving 30 days
prior written notice to USBPS.
10. To induce USBPS on behalf of the Trustee to enter this
Agreement, the Guarantor hereby affirms and restates its Guarantee as related to
this Loan and AMENDED AND RESTATED RIDER A.
11. Radnet, the Company and the Guarantor each represent and
warrant that each has been represented by an attorney of its choice and is fully
aware of the terms contained in this Agreement and AMENDED AND RESTATED RIDER A
to which it is a party which was voluntarily entered into without coercion or
duress of any kind.
12. Radnet represents and warrants to USBPS on behalf of the
Noteholders and Trustee that all necessary actions on the part of Radnet to be
taken in connection with the execution, delivery and performance of this
Agreement have been taken; the performance by Radnet of this Agreement and the
AMENDED AND RESTATED RIDER A will not violate any of
6
#1231-041
Radnet's Articles of Incorporation, Articles of Formation, Partnership Agreement
or other agreement or law by which Radnet is bound.
13. Any notice, request, direction, consent, approval, waiver
or other communication required or permitted under this Agreement to be sent
must be in writing and will become effective only upon delivery to USBPS at the
address set forth herein as follows:
U.S. Bank Portfolio Services
0000 Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxx, XX 00000
Attn: Xxxx Xxx, Director of Operations
14. Except as provided herein, and in the AMENDED AND RESTATED
RIDER A, all of the other provisions of the Loan Documents not restated will
remain in effect.
15. This Agreement and the documents referenced herein
constitute the entire and final agreement among the parties with respect to the
subject matter hereof and there are no agreements, understandings, warranties or
representations among the parties with respect to these matters except as set
forth herein.
16. This Agreement will inure to the benefit of and bind the
parties and their respective successors and permitted assigns.
17. Neither this Agreement nor any of the provisions hereof
can be changed, waived, discharged or terminated except by an instrument in
writing signed by the parties against whom such enforcement of the change,
waiver, discharge or termination is sought.
18. This Agreement will be interpreted and construed under the
laws of the Commonwealth of Pennsylvania, regardless of the domicile of any
party and will be considered to have been made, executed and performed in
Pennsylvania.
7
#1231-041
19. THE UNDERSIGNED, AND SUBJECT TO THE PROVISIONS CONTAINED
HEREIN, USBPS FOR ITSELF AND AS AGENT FOR THE TRUSTEE, (A) AGREE TO SUBMIT FOR
THEMSELVES, IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT AND ANY
SCHEDULE OR FOR RECOGNITION AND ENFORCEMENT OF ANY JUDGMENT IN RESPECT HEREOF OR
THEREOF, TO THE EXCLUSIVE JURISDICTION OF THE COURTS OF THE COMONWEALTH OF
PENNSYLVANIA, THE COURTS OF THE UNITED STATES OF AMERICA FOR THE EASTERN
DISTRICT OF PENNSYLVANIA, AND APPELLATE COURTS FROM ANY THEREOF, (B) CONSENT
THAT ANY ACTION OR PROCEEDING SHALL BE BROUGHT IN SUCH COURTS, AND WAIVE ANY
OBJECTION THAT EACH MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH ACTION OR
PROCEEDING IN ANY SUCH COURT, (C) AGREE THAT SERVICE OF PROCESS OF ANY SUCH
ACTION OR PROCEEDING MAY BE EFFECTED BY CERTIFIED MAIL (OR ANY SUBSTANTIALLY
SIMILAR FORM OF MAIL), POSTAGE PREPAID, TO THE APPROPRIATE PARTY AT ITS ADDRESS
AS SET FORTH HEREIN, AND SERVICE MADE SHALL BE DEEMED TO BE COMPLETED UPON THE
EARLIER OF ACTUAL RECEIPT OR FIVE (5) DAYS AFTER THE SAME SHALL HAVE BEEN POSTED
AS AFORESAID, AND (D) AGREE THAT NOTHING HEREIN OR IN ANY EXHIBIT OR SCHEDULE
SHALL AFFECT THE RIGHT TO EFFECT SERVICE OF PROCESS IN ANY OTHER MANNER
PERMITTED BY LAW. USBPS AND THE UNDERSIGNED EACH HEREBY UNCONDITIONALLY WAIVES
ITS RIGHT TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING
OUT OF, DIRECTLY OR INDIRECTLY, THIS AGREEMENT, ANY EXHIBIT AND THE TRANSACTIONS
8
#1231-041
CONTEMPLATED HEREBY AND THEREBY, ANY OF THE RELATED DOCUMENTS, ANY DEALINGS
BETWEEN THE PARTIES HERETO RELATING TO THE SUBJECT MATTER HEREOF OR THEREOF,
AND/OR THE RELATIONSHIP THAT IS BEING ESTABLISHED BETWEEN USBPS AS AGENT FOR THE
TRUSTEE AND THE UNDERSIGNED, PROVIDED USBPS MAY IN ITS DISCRETION ENFORCE THE
TERMS OF THE FORUM SELECTION PROVISIONS IN THE LOANS.
20. Radnet, the Company and the Guarantor hereby release
USBPS, the Trustee, and the Noteholders from and against any claim, loss, or
damage arising out of the negotiation execution, and performance of the Loan or
related matters prior to the date hereof.
21. This Agreement may be executed in two or more counterparts
and each counterpart shall be deemed an original.
9
#1231-041
LYON FINANCIAL SERVICES, INC. DBA U.S.
BANK PORTFOLIO SERVICES, AS SUCCESSOR
SERVICER FOR DVI RECEIVABLES VIII, L.L.C.
AND AS AGENT FOR U.S. BANK, N.A., AS TRUSTEE
By: ________________________________________
RADNET MANAGEMENT, INC.
By: ________________________________________
ACKNOWLEDGED AND AGREED TO:
Primedex Health Systems, Inc., Guarantor
By: ____________________________________
10
#1231-040
AMENDMENT TO LOAN DOCUMENTS
---------------------------
AGREEMENT made as of June 30, 2004 ("AMENDMENT AGREEMENT" or
"AGREEMENT") by and between LYON FINANCIAL SERVICES, INC. DBA U.S. BANK
PORTFOLIO SERVICES, as Successor Servicer for DVI Receivables XII, L.L.C. and as
Agent for U.S. Bank, N.A., as Trustee, with offices at 0000 Xxxxxx Xxxxxx, Xxxxx
000, Xxxxxxxx, Xxxxxxxxx 00000 ("USBPS") and Radnet Management, Inc., a
corporation, with offices at 0000 Xxxxxx Xxxxxx, Xxx Xxxxxxx, XX 00000
("RADNET"), and such other signatories hereto.
WHEREAS, on or about Xxxxx 00, 0000, Xxxxxx executed and
delivered to DVI Financial Services Inc. ("DVI") a Loan and Security Agreement
collectively with the Schedule Number #1231-040 dated December 20, 1999 (the
"LOAN");
WHEREAS, to secure the payment of the Loan and all other
obligations of Radnet to DVI (collectively the "OBLIGATIONS"), Radnet, pursuant
to a Security Agreement dated on or about December 15, 1997 (the "SECURITY
AGREEMENT"), granted DVI a first priority security interest in certain
Collateral described therein;
WHEREAS, to further secure payment of the Note and all other
Obligations of Radnet to DVI, Radnet delivered to DVI the guarantee (the
"GUARANTEE") of Primedex Health Systems, Inc. (the "GUARANTOR") (the "GUARANTEE"
together with the Loan and ancillary documents are, collectively the "LOAN
DOCUMENTS");
WHEREAS, substantially contemporaneously therewith, DVI
contributed all of the Loan Documents to DVI Receivables XII, L.L.C. ("DVI XII")
and thereafter pursuant to an Amended and Restated Indenture, DVI XII granted a
first priority security interest in and pledged all of the Loan Documents in
favor of U.S. Bank, N.A., as Trustee, for the benefit of a
#1231-040
noteholder which purchased asset backed promissory notes issued by DVI XII (the
"Noteholder");
WHEREAS, DVI contributed other Loans with Radnet or certain
affiliates of Radnet to this and other DVI securitizations (collectively the
"RELATED LOANS");
WHEREAS, Radnet is in default under the terms of the Loan;
WHEREAS, Radnet has requested USBPS to modify the Loan to
reflect an adjustment in payments;
WHEREAS, Radnet and/or certain of its affiliates have agreed
to modify the Related Loans;
WHEREAS, Radnet and certain of its affiliates are engaged in
negotiations to restructure or modify certain loan agreements, loans and
promissory notes with each of General Electric Capital Corporation ("GECC") and
DVI (with respect to GECC, the "GECC MODIFICATION", and with respect to DVI, the
"DVI MODIFICATION");
WHEREAS, subject to the following terms and conditions, USBPS
is willing to modify the Loan as hereinafter provided.
NOW, THEREFORE, the parties agree as follows:
1. All of the Whereas clauses are incorporated herein as if
hereinafter set forth at full length.
2. Radnet acknowledges that it is duly indebted to the Trustee
in the sum set forth on AMENDED AND RESTATED RIDER A annexed hereto, and has no
defenses, counterclaims or offsets to such indebtedness.
3. USBPS as Agent for the Trustee will modify the Loan to
provide for payments to commence in accordance with the attached revised payment
schedule (the
2
#1231-040
"AMENDED AND RESTATED RIDER A"). Radnet may, at any time, prepay all of the then
outstanding Obligations subject to an additional prepayment fee of 2% of such
Obligations. Partial prepayments of the Obligations shall not be permitted at
any time.
4. This Agreement shall become effective upon the date that
USBPS receives this Agreement duly executed by Radnet and the satisfaction of
each of the following conditions:
(a) Radnet and/or its affiliates shall have entered
into agreements on similar terms to this Agreement and
otherwise in form and substance satisfactory to USBPS,
relating to the Related Loans (the "Related Loan
Modifications");
(b) reimbursement of USBPS's legal fees incurred in
connection with the execution of this Agreement and the
Related Loan Modifications, aggregating $50,000, shall have
been received by USBPS;
(c) Radnet and/or its affiliates shall have entered
into the GECC Modification and the DVI Modification.
5. The closing of the restructuring of the Radnet Loan is
further subject to delivery to USBPS of all of the following, each in form and
substance satisfactory to USBPS and its counsel:
(a) The executed AMENDED AND RESTATED RIDER A;
(b) An executed copy of this Agreement;
(c) Such other documents, including UCC financing
statements as USBPS reasonably requests.
6. Radnet hereby acknowledges and agrees that it has no, and
will not assert any, defenses, counterclaims or offsets to the Loan and AMENDED
AND RESTATED RIDER A and acknowledges and agrees that the Trustee holds a
first-priority security interest in the Collateral.
7. Any default or other breach of any obligation under the
GECC Modification, the DVI Modification, or any of the Related Loan
Modifications shall constitute a
3
#1231-040
default under the Loan as modified by this Agreement, and USBPS shall have all
remedies thereunder.
8. Radnet hereby releases the Noteholder, USBPS individually
and as agent for the Trustee and the special purpose entities for which the
Trustee holds collateral, from and against any claims, loss or damage of any
kind or nature arising out of the Loan.
9. So long as any of the Obligations remain outstanding,
Radnet Management, Inc. (the "COMPANY") agrees as follows:
(i) FINANCIAL REPORTING. The Company shall furnish
the following documents or information to USBPS:
(A) Within 30 days after the end of each
Fiscal Quarter (as defined below) (i) (or 90 days in respect of the last month
of the fiscal year), the Company's consolidated, consolidating and on a center
by center basis, financial statements, including the most recent annual report,
balance sheet (not on a center by center basis) and income statement, prepared
in accordance with generally accepted accounting principles, which reports, the
Company warrants, shall fully and fairly represent the true financial condition
of the Company and (ii) updated projections for the Company and for each center;
(B) any other financial information normally
provided by the Company to the public; and
(C) Such other financial data or information
relative to this Amendment Agreement, including, without limitation, listings of
serial numbers or other identification data and confirmations of such
information, as USBPS may time-to-time reasonably request.
(ii) NO AMENDMENTS. Subsequent to the date of this
Amendment Agreement, the Company will not agree or consent to any amendments or
modifications to any agreement between the Company and DVI, GECC or Xxxxx Fargo
Foothill, Inc. ("FOOTHILL") containing terms (including, but not limited to,
increasing interest rates, accelerating the principal amortization or maturity,
new or more stringent defaults, additional collateral, and new remedies
provisions) that would be more onerous to the Company, or adversely impact or
affect GECC with respect to the terms of this Amendment Agreement.
(iii) DISTRIBUTIONS. The Company shall not make any
distribution or declare or pay any dividends (in cash or other property, other
than common stock) on, or purchase, acquire, redeem, or retire any of the
Company's stock, of any class, whether now or hereafter outstanding
(collectively, "DISTRIBUTIONS"); PROVIDED, HOWEVER, that so long as no
4
#1231-040
default shall have occurred and be continuing immediately prior to or after
giving effect to any such payment, (a) the Company may make Distributions to
Primedex Health Systems, Inc., a New York corporation (the "PARENT") (1) in
amounts necessary to pay customary expenses of Parent in the ordinary course of
its business as a public holding company (including salaries and related
reasonable and customary expenses incurred by employees of Parent) in an
aggregate amount not to exceed $750,000 in any fiscal year, (2) in amounts
necessary to enable Parent to pay taxes when due and owing by it in the ordinary
course of its business as a holding company and (3) in amounts necessary to
enable Parent to pay interest on those certain 11.5% Series A Convertible
Subordinated Notes due June 30, 2008, issued by Parent on June 25, 1993, and (b)
Parent may make Distributions in the form of common stock.
(iv) FIXED CHARGE COVERAGE RATIO. Commencing April
30, 2005, the Company shall not permit the Fixed Charge Coverage Ratio, (a) to
be less than 1.0:1 as of the end of each April, July, October and January (each,
a "FISCAL QUARTER") ending prior to January 1, 2007, and (b) to be less than
1.05:1 as of the last day of each Fiscal Quarter ending thereafter. "FIXED
CHARGE COVERAGE RATIO" means for any period, the ratio of (i) EBITDA for such
period MINUS cash capital expenditures made (to the extent not already incurred
in a prior period) or incurred during such period, to (ii) the sum of (a)
interest expense, (b) principal payments required to be paid during such period
in respect of indebtedness, and (c) all federal, state, and local income taxes
accrued, all as determined for the twelve months ending on the determination
date for the Company and its subsidiaries on a consolidated basis without
duplication and in accordance with generally accepted accounting principles
consistently applied. "EBITDA" means, with respect to any fiscal period, the
Company's and its subsidiaries' consolidated net earnings (or loss), minus
extraordinary gains and interest income, plus interest expense, income taxes,
and depreciation and amortization for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(v) LEVERAGE RATIO. The Company shall not permit the
Leverage Ratio, as determined as of the end of each Fiscal Quarter, to be
greater than the amount set forth in the following table for the Fiscal Quarters
ending in the period set forth opposite thereto:
LEVERAGE RATIO PERIOD
-------------- ------
4.50:1.0 04/30/05 - 10/30/05
4.30:1.0 10/31/05 - 10/30/06
4.00:1.0 10/31/06 - 10/30/07
3.80:1.0 10/31/07 - 10/30/08
"LEVERAGE RATIO" means, at any date of determination, the
ratio of (a) Total Debt at such date to (b) EBITDA for the applicable period
ending on such date. "TOTAL DEBT" means, as of any date of determination,
without duplication, the sum of (a) the outstanding aggregate amount of the
obligations for borrowed money, (b) the outstanding principal amount of capital
leases, (c) the outstanding principal amount of purchase money indebtedness, (d)
the outstanding principal amount of funded debt, and (e) the outstanding
principal amount of all obligations
5
#1231-040
owing to GECC, DVI and USBPS; all as determined for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(vi) EBITDA MARGIN. The Company shall not permit the
EBITDA Margin to be less than 25% as of the end of any Fiscal Quarter ending on
or after April 30, 2005. "EBITDA MARGIN" means for any period, the ratio of (a)
EBITDA for such period, to (b) net revenues (excluding the professional service
fee component of radiology services) for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(vii) RECEIVABLE DAYS. The Company shall not permit
the Receivable Days to exceed 65 days as of the end of any Fiscal Quarter ending
on or after April 30, 2005. "RECEIVABLE DAYS" means for any period, a number
equal to (a) 365 divided by (b) the result of (i) net revenues for such period
divided by (ii) net receivables for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(viii) NAME CHANGES, ETC. The Company agrees that it
shall not change its name or jurisdiction of organization without giving 30 days
prior written notice to USBPS.
10. To induce USBPS on behalf of the Trustee to enter this
Agreement, the Guarantor hereby affirms and restates its Guarantee as related to
this Loan and AMENDED AND RESTATED RIDER A.
11. Radnet, the Company and the Guarantor each represent and
warrant that each has been represented by an attorney of its choice and is fully
aware of the terms contained in this Agreement and AMENDED AND RESTATED RIDER A
to which it is a party which was voluntarily entered into without coercion or
duress of any kind.
12. Radnet represents and warrants to USBPS on behalf of the
Noteholders and Trustee that all necessary actions on the part of Radnet to be
taken in connection with the execution, delivery and performance of this
Agreement have been taken; the performance by Radnet of this Agreement and the
AMENDED AND RESTATED RIDER A will not violate any of
6
#1231-040
Radnet's Articles of Incorporation, Articles of Formation, Partnership Agreement
or other agreement or law by which Radnet is bound.
13. Any notice, request, direction, consent, approval, waiver
or other communication required or permitted under this Agreement to be sent
must be in writing and will become effective only upon delivery to USBPS at the
address set forth herein as follows:
U.S. Bank Portfolio Services
0000 Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxx, XX 00000
Attn: Xxxx Xxx, Director of Operations
14. Except as provided herein, and in the AMENDED AND RESTATED
RIDER A, all of the other provisions of the Loan Documents not restated will
remain in effect.
15. This Agreement and the documents referenced herein
constitute the entire and final agreement among the parties with respect to the
subject matter hereof and there are no agreements, understandings, warranties or
representations among the parties with respect to these matters except as set
forth herein.
16. This Agreement will inure to the benefit of and bind the
parties and their respective successors and permitted assigns.
17. Neither this Agreement nor any of the provisions hereof
can be changed, waived, discharged or terminated except by an instrument in
writing signed by the parties against whom such enforcement of the change,
waiver, discharge or termination is sought.
18. This Agreement will be interpreted and construed under the
laws of the Commonwealth of Pennsylvania, regardless of the domicile of any
party and will be considered to have been made, executed and performed in
Pennsylvania.
7
#1231-040
19. THE UNDERSIGNED, AND SUBJECT TO THE PROVISIONS CONTAINED
HEREIN, USBPS FOR ITSELF AND AS AGENT FOR THE TRUSTEE, (A) AGREE TO SUBMIT FOR
THEMSELVES, IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT AND ANY
SCHEDULE OR FOR RECOGNITION AND ENFORCEMENT OF ANY JUDGMENT IN RESPECT HEREOF OR
THEREOF, TO THE EXCLUSIVE JURISDICTION OF THE COURTS OF THE COMONWEALTH OF
PENNSYLVANIA, THE COURTS OF THE UNITED STATES OF AMERICA FOR THE EASTERN
DISTRICT OF PENNSYLVANIA, AND APPELLATE COURTS FROM ANY THEREOF, (B) CONSENT
THAT ANY ACTION OR PROCEEDING SHALL BE BROUGHT IN SUCH COURTS, AND WAIVE ANY
OBJECTION THAT EACH MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH ACTION OR
PROCEEDING IN ANY SUCH COURT, (C) AGREE THAT SERVICE OF PROCESS OF ANY SUCH
ACTION OR PROCEEDING MAY BE EFFECTED BY CERTIFIED MAIL (OR ANY SUBSTANTIALLY
SIMILAR FORM OF MAIL), POSTAGE PREPAID, TO THE APPROPRIATE PARTY AT ITS ADDRESS
AS SET FORTH HEREIN, AND SERVICE MADE SHALL BE DEEMED TO BE COMPLETED UPON THE
EARLIER OF ACTUAL RECEIPT OR FIVE (5) DAYS AFTER THE SAME SHALL HAVE BEEN POSTED
AS AFORESAID, AND (D) AGREE THAT NOTHING HEREIN OR IN ANY EXHIBIT OR SCHEDULE
SHALL AFFECT THE RIGHT TO EFFECT SERVICE OF PROCESS IN ANY OTHER MANNER
PERMITTED BY LAW. USBPS AND THE UNDERSIGNED EACH HEREBY UNCONDITIONALLY WAIVES
ITS RIGHT TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING
OUT OF, DIRECTLY OR INDIRECTLY, THIS AGREEMENT, ANY EXHIBIT AND THE TRANSACTIONS
8
#1231-040
CONTEMPLATED HEREBY AND THEREBY, ANY OF THE RELATED DOCUMENTS, ANY DEALINGS
BETWEEN THE PARTIES HERETO RELATING TO THE SUBJECT MATTER HEREOF OR THEREOF,
AND/OR THE RELATIONSHIP THAT IS BEING ESTABLISHED BETWEEN USBPS AS AGENT FOR THE
TRUSTEE AND THE UNDERSIGNED, PROVIDED USBPS MAY IN ITS DISCRETION ENFORCE THE
TERMS OF THE FORUM SELECTION PROVISIONS IN THE LOANS.
20. Radnet, the Company and the Guarantor hereby release
USBPS, the Trustee, and the Noteholders from and against any claim, loss, or
damage arising out of the negotiation execution, and performance of the Loan or
related matters prior to the date hereof.
21. This Agreement may be executed in two or more counterparts
and each counterpart shall be deemed an original.
9
#1231-040
LYON FINANCIAL SERVICES, INC. DBA U.S.
BANK PORTFOLIO SERVICES, AS SUCCESSOR
SERVICER FOR DVI RECEIVABLES XII, L.L.C.
AND AS AGENT FOR U.S. BANK, N.A., AS TRUSTEE
By: ________________________________________
RADNET MANAGEMENT, INC.
By: ________________________________________
ACKNOWLEDGED AND AGREED TO:
Primedex Health Systems, Inc., Guarantor
By: ____________________________________
10
#1231-037
AMENDMENT TO LOAN DOCUMENTS
---------------------------
AGREEMENT made as of June 30, 2004 ("AMENDMENT AGREEMENT" or
"AGREEMENT") by and between LYON FINANCIAL SERVICES, INC. DBA U.S. BANK
PORTFOLIO SERVICES, as Successor Servicer for DVI Receivables XII, L.L.C. and as
Agent for U.S. Bank, N.A., as Trustee, with offices at 0000 Xxxxxx Xxxxxx, Xxxxx
000, Xxxxxxxx, Xxxxxxxxx 00000 ("USBPS") and Radnet Management, Inc., a
corporation, with offices at 0000 Xxxxxx Xxxxxx, Xxx Xxxxxxx, XX 00000
("RADNET"), and such other signatories hereto.
WHEREAS, on or about Xxxxx 00, 0000, Xxxxxx executed and
delivered to DVI Financial Services Inc. ("DVI") a Loan and Security Agreement
collectively with the Schedule Number #1231-037 dated December 20, 1999 (the
"LOAN");
WHEREAS, to secure the payment of the Loan and all other
obligations of Radnet to DVI (collectively the "OBLIGATIONS"), Radnet, pursuant
to a Security Agreement dated on or about December 15, 1997 (the "SECURITY
AGREEMENT"), granted DVI a first priority security interest in certain
Collateral described therein;
WHEREAS, to further secure payment of the Note and all other
Obligations of Radnet to DVI, Radnet delivered to DVI the guarantee (the
"GUARANTEE") of Primedex Health Systems, Inc. (the "GUARANTOR") (the "GUARANTEE"
together with the Loan and ancillary documents are, collectively the "LOAN
DOCUMENTS");
WHEREAS, substantially contemporaneously therewith, DVI
contributed all of the Loan Documents to DVI Receivables XII, L.L.C. ("DVI XII")
and thereafter pursuant to an Amended and Restated Indenture, DVI XII granted a
first priority security interest in and pledged all of the Loan Documents in
favor of U.S. Bank, N.A., as Trustee, for the benefit of a
#1231-037
noteholder which purchased asset backed promissory notes issued by DVI XII (the
"Noteholder");
WHEREAS, DVI contributed other Loans with Radnet or certain
affiliates of Radnet to this and other DVI securitizations (collectively the
"RELATED LOANS");
WHEREAS, Radnet is in default under the terms of the Loan;
WHEREAS, Radnet has requested USBPS to modify the Loan to
reflect an adjustment in payments;
WHEREAS, Radnet and/or certain of its affiliates have agreed
to modify the Related Loans;
WHEREAS, Radnet and certain of its affiliates are engaged in
negotiations to restructure or modify certain loan agreements, loans and
promissory notes with each of General Electric Capital Corporation ("GECC") and
DVI (with respect to GECC, the "GECC MODIFICATION", and with respect to DVI, the
"DVI MODIFICATION");
WHEREAS, subject to the following terms and conditions, USBPS
is willing to modify the Loan as hereinafter provided.
NOW, THEREFORE, the parties agree as follows:
1. All of the Whereas clauses are incorporated herein as if
hereinafter set forth at full length.
2. Radnet acknowledges that it is duly indebted to the Trustee
in the sum set forth on AMENDED AND RESTATED RIDER A annexed hereto, and has no
defenses, counterclaims or offsets to such indebtedness.
3. USBPS as Agent for the Trustee will modify the Loan to
provide for payments to commence in accordance with the attached revised payment
schedule (the
2
#1231-037
"AMENDED AND RESTATED RIDER A"). Radnet may, at any time, prepay all of the then
outstanding Obligations subject to an additional prepayment fee of 2% of such
Obligations. Partial prepayments of the Obligations shall not be permitted at
any time.
4. This Agreement shall become effective upon the date that
USBPS receives this Agreement duly executed by Radnet and the satisfaction of
each of the following conditions:
(a) Radnet and/or its affiliates shall have entered
into agreements on similar terms to this Agreement and
otherwise in form and substance satisfactory to USBPS,
relating to the Related Loans (the "Related Loan
Modifications");
(b) reimbursement of USBPS's legal fees incurred in
connection with the execution of this Agreement and the
Related Loan Modifications, aggregating $50,000, shall have
been received by USBPS;
(c) Radnet and/or its affiliates shall have entered
into the GECC Modification and the DVI Modification.
5. The closing of the restructuring of the Radnet Loan is
further subject to delivery to USBPS of all of the following, each in form and
substance satisfactory to USBPS and its counsel:
(a) The executed AMENDED AND RESTATED RIDER A;
(b) An executed copy of this Agreement;
(c) Such other documents, including UCC financing
statements as USBPS reasonably requests.
6. Radnet hereby acknowledges and agrees that it has no, and
will not assert any, defenses, counterclaims or offsets to the Loan and AMENDED
AND RESTATED RIDER A and acknowledges and agrees that the Trustee holds a
first-priority security interest in the Collateral.
7. Any default or other breach of any obligation under the
GECC Modification, the DVI Modification, or any of the Related Loan
Modifications shall constitute a
3
#1231-037
default under the Loan as modified by this Agreement, and USBPS shall have all
remedies thereunder.
8. Radnet hereby releases the Noteholder, USBPS individually
and as agent for the Trustee and the special purpose entities for which the
Trustee holds collateral, from and against any claims, loss or damage of any
kind or nature arising out of the Loan.
9. So long as any of the Obligations remain outstanding,
Radnet Management, Inc. (the "COMPANY") agrees as follows:
(i) FINANCIAL REPORTING. The Company shall furnish
the following documents or information to USBPS:
(A) Within 30 days after the end of each
Fiscal Quarter (as defined below) (i) (or 90 days in respect of the last month
of the fiscal year), the Company's consolidated, consolidating and on a center
by center basis, financial statements, including the most recent annual report,
balance sheet (not on a center by center basis) and income statement, prepared
in accordance with generally accepted accounting principles, which reports, the
Company warrants, shall fully and fairly represent the true financial condition
of the Company and (ii) updated projections for the Company and for each center;
(B) any other financial information normally
provided by the Company to the public; and
(C) Such other financial data or information
relative to this Amendment Agreement, including, without limitation, listings of
serial numbers or other identification data and confirmations of such
information, as USBPS may time-to-time reasonably request.
(ii) NO AMENDMENTS. Subsequent to the date of this
Amendment Agreement, the Company will not agree or consent to any amendments or
modifications to any agreement between the Company and DVI, GECC or Xxxxx Fargo
Foothill, Inc. ("FOOTHILL") containing terms (including, but not limited to,
increasing interest rates, accelerating the principal amortization or maturity,
new or more stringent defaults, additional collateral, and new remedies
provisions) that would be more onerous to the Company, or adversely impact or
affect GECC with respect to the terms of this Amendment Agreement.
(iii) DISTRIBUTIONS. The Company shall not make any
distribution or declare or pay any dividends (in cash or other property, other
than common stock) on, or purchase, acquire, redeem, or retire any of the
Company's stock, of any class, whether now or hereafter outstanding
(collectively, "DISTRIBUTIONS"); PROVIDED, HOWEVER, that so long as no
4
#1231-037
default shall have occurred and be continuing immediately prior to or after
giving effect to any such payment, (a) the Company may make Distributions to
Primedex Health Systems, Inc., a New York corporation (the "PARENT") (1) in
amounts necessary to pay customary expenses of Parent in the ordinary course of
its business as a public holding company (including salaries and related
reasonable and customary expenses incurred by employees of Parent) in an
aggregate amount not to exceed $750,000 in any fiscal year, (2) in amounts
necessary to enable Parent to pay taxes when due and owing by it in the ordinary
course of its business as a holding company and (3) in amounts necessary to
enable Parent to pay interest on those certain 11.5% Series A Convertible
Subordinated Notes due June 30, 2008, issued by Parent on June 25, 1993, and (b)
Parent may make Distributions in the form of common stock.
(iv) FIXED CHARGE COVERAGE RATIO. Commencing April
30, 2005, the Company shall not permit the Fixed Charge Coverage Ratio, (a) to
be less than 1.0:1 as of the end of each April, July, October and January (each,
a "FISCAL QUARTER") ending prior to January 1, 2007, and (b) to be less than
1.05:1 as of the last day of each Fiscal Quarter ending thereafter. "FIXED
CHARGE COVERAGE RATIO" means for any period, the ratio of (i) EBITDA for such
period MINUS cash capital expenditures made (to the extent not already incurred
in a prior period) or incurred during such period, to (ii) the sum of (a)
interest expense, (b) principal payments required to be paid during such period
in respect of indebtedness, and (c) all federal, state, and local income taxes
accrued, all as determined for the twelve months ending on the determination
date for the Company and its subsidiaries on a consolidated basis without
duplication and in accordance with generally accepted accounting principles
consistently applied. "EBITDA" means, with respect to any fiscal period, the
Company's and its subsidiaries' consolidated net earnings (or loss), minus
extraordinary gains and interest income, plus interest expense, income taxes,
and depreciation and amortization for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(v) LEVERAGE RATIO. The Company shall not permit the
Leverage Ratio, as determined as of the end of each Fiscal Quarter, to be
greater than the amount set forth in the following table for the Fiscal Quarters
ending in the period set forth opposite thereto:
LEVERAGE RATIO PERIOD
-------------- ------
4.50:1.0 04/30/05 - 10/30/05
4.30:1.0 10/31/05 - 10/30/06
4.00:1.0 10/31/06 - 10/30/07
3.80:1.0 10/31/07 - 10/30/08
"LEVERAGE RATIO" means, at any date of determination, the
ratio of (a) Total Debt at such date to (b) EBITDA for the applicable period
ending on such date. "TOTAL DEBT" means, as of any date of determination,
without duplication, the sum of (a) the outstanding aggregate amount of the
obligations for borrowed money, (b) the outstanding principal amount of capital
leases, (c) the outstanding principal amount of purchase money indebtedness, (d)
the outstanding principal amount of funded debt, and (e) the outstanding
principal amount of all obligations
5
#1231-037
owing to GECC, DVI and USBPS; all as determined for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(vi) EBITDA MARGIN. The Company shall not permit the
EBITDA Margin to be less than 25% as of the end of any Fiscal Quarter ending on
or after April 30, 2005. "EBITDA MARGIN" means for any period, the ratio of (a)
EBITDA for such period, to (b) net revenues (excluding the professional service
fee component of radiology services) for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(vii) RECEIVABLE DAYS. The Company shall not permit
the Receivable Days to exceed 65 days as of the end of any Fiscal Quarter ending
on or after April 30, 2005. "RECEIVABLE DAYS" means for any period, a number
equal to (a) 365 divided by (b) the result of (i) net revenues for such period
divided by (ii) net receivables for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(viii) NAME CHANGES, ETC. The Company agrees that it
shall not change its name or jurisdiction of organization without giving 30 days
prior written notice to USBPS.
10. To induce USBPS on behalf of the Trustee to enter this
Agreement, the Guarantor hereby affirms and restates its Guarantee as related to
this Loan and AMENDED AND RESTATED RIDER A.
11. Radnet, the Company and the Guarantor each represent and
warrant that each has been represented by an attorney of its choice and is fully
aware of the terms contained in this Agreement and AMENDED AND RESTATED RIDER A
to which it is a party which was voluntarily entered into without coercion or
duress of any kind.
12. Radnet represents and warrants to USBPS on behalf of the
Noteholders and Trustee that all necessary actions on the part of Radnet to be
taken in connection with the execution, delivery and performance of this
Agreement have been taken; the performance by Radnet of this Agreement and the
AMENDED AND RESTATED RIDER A will not violate any of
6
#1231-037
Radnet's Articles of Incorporation, Articles of Formation, Partnership Agreement
or other agreement or law by which Radnet is bound.
13. Any notice, request, direction, consent, approval, waiver
or other communication required or permitted under this Agreement to be sent
must be in writing and will become effective only upon delivery to USBPS at the
address set forth herein as follows:
U.S. Bank Portfolio Services
0000 Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxx, XX 00000
Attn: Xxxx Xxx, Director of Operations
14. Except as provided herein, and in the AMENDED AND RESTATED
RIDER A, all of the other provisions of the Loan Documents not restated will
remain in effect.
15. This Agreement and the documents referenced herein
constitute the entire and final agreement among the parties with respect to the
subject matter hereof and there are no agreements, understandings, warranties or
representations among the parties with respect to these matters except as set
forth herein.
16. This Agreement will inure to the benefit of and bind the
parties and their respective successors and permitted assigns.
17. Neither this Agreement nor any of the provisions hereof
can be changed, waived, discharged or terminated except by an instrument in
writing signed by the parties against whom such enforcement of the change,
waiver, discharge or termination is sought.
18. This Agreement will be interpreted and construed under the
laws of the Commonwealth of Pennsylvania, regardless of the domicile of any
party and will be considered to have been made, executed and performed in
Pennsylvania.
7
#1231-037
19. THE UNDERSIGNED, AND SUBJECT TO THE PROVISIONS CONTAINED
HEREIN, USBPS FOR ITSELF AND AS AGENT FOR THE TRUSTEE, (A) AGREE TO SUBMIT FOR
THEMSELVES, IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT AND ANY
SCHEDULE OR FOR RECOGNITION AND ENFORCEMENT OF ANY JUDGMENT IN RESPECT HEREOF OR
THEREOF, TO THE EXCLUSIVE JURISDICTION OF THE COURTS OF THE COMONWEALTH OF
PENNSYLVANIA, THE COURTS OF THE UNITED STATES OF AMERICA FOR THE EASTERN
DISTRICT OF PENNSYLVANIA, AND APPELLATE COURTS FROM ANY THEREOF, (B) CONSENT
THAT ANY ACTION OR PROCEEDING SHALL BE BROUGHT IN SUCH COURTS, AND WAIVE ANY
OBJECTION THAT EACH MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH ACTION OR
PROCEEDING IN ANY SUCH COURT, (C) AGREE THAT SERVICE OF PROCESS OF ANY SUCH
ACTION OR PROCEEDING MAY BE EFFECTED BY CERTIFIED MAIL (OR ANY SUBSTANTIALLY
SIMILAR FORM OF MAIL), POSTAGE PREPAID, TO THE APPROPRIATE PARTY AT ITS ADDRESS
AS SET FORTH HEREIN, AND SERVICE MADE SHALL BE DEEMED TO BE COMPLETED UPON THE
EARLIER OF ACTUAL RECEIPT OR FIVE (5) DAYS AFTER THE SAME SHALL HAVE BEEN POSTED
AS AFORESAID, AND (D) AGREE THAT NOTHING HEREIN OR IN ANY EXHIBIT OR SCHEDULE
SHALL AFFECT THE RIGHT TO EFFECT SERVICE OF PROCESS IN ANY OTHER MANNER
PERMITTED BY LAW. USBPS AND THE UNDERSIGNED EACH HEREBY UNCONDITIONALLY WAIVES
ITS RIGHT TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING
OUT OF, DIRECTLY OR INDIRECTLY, THIS AGREEMENT, ANY EXHIBIT AND THE TRANSACTIONS
8
#1231-037
CONTEMPLATED HEREBY AND THEREBY, ANY OF THE RELATED DOCUMENTS, ANY DEALINGS
BETWEEN THE PARTIES HERETO RELATING TO THE SUBJECT MATTER HEREOF OR THEREOF,
AND/OR THE RELATIONSHIP THAT IS BEING ESTABLISHED BETWEEN USBPS AS AGENT FOR THE
TRUSTEE AND THE UNDERSIGNED, PROVIDED USBPS MAY IN ITS DISCRETION ENFORCE THE
TERMS OF THE FORUM SELECTION PROVISIONS IN THE LOANS.
20. Radnet, the Company and the Guarantor hereby release
USBPS, the Trustee, and the Noteholders from and against any claim, loss, or
damage arising out of the negotiation execution, and performance of the Loan or
related matters prior to the date hereof.
21. This Agreement may be executed in two or more counterparts
and each counterpart shall be deemed an original.
9
#1231-037
LYON FINANCIAL SERVICES, INC. DBA U.S.
BANK PORTFOLIO SERVICES, AS SUCCESSOR
SERVICER FOR DVI RECEIVABLES XII, L.L.C.
AND AS AGENT FOR U.S. BANK, N.A., AS TRUSTEE
By: ________________________________________
RADNET MANAGEMENT, INC.
By: ________________________________________
ACKNOWLEDGED AND AGREED TO:
Primedex Health Systems, Inc., Guarantor
By: ____________________________________
10
#1231-035
AMENDMENT TO LOAN DOCUMENTS
---------------------------
AGREEMENT made as of June 30, 2004 ("AMENDMENT AGREEMENT" or
"AGREEMENT") by and between LYON FINANCIAL SERVICES, INC. DBA U.S. BANK
PORTFOLIO SERVICES, as Successor Servicer for DVI Receivables XI, L.L.C. and as
Agent for U.S. Bank, N.A., as Trustee, with offices at 0000 Xxxxxx Xxxxxx, Xxxxx
000, Xxxxxxxx, Xxxxxxxxx 00000 ("USBPS") and Radnet Management, Inc., a
corporation, with offices at 0000 Xxxxxx Xxxxxx, Xxx Xxxxxxx, XX 00000
("RADNET"), and such other signatories hereto.
WHEREAS, on or about Xxxxx 00, 0000, Xxxxxx executed and
delivered to DVI Financial Services Inc. ("DVI") a Loan and Security Agreement
collectively with the Schedule Number #1231-035 dated September 28, 1999 (the
"LOAN");
WHEREAS, to secure the payment of the Loan and all other
obligations of Radnet to DVI (collectively the "OBLIGATIONS"), Radnet, pursuant
to a Security Agreement dated on or about December 15, 1997 (the "SECURITY
AGREEMENT"), granted DVI a first priority security interest in certain
Collateral described therein;
WHEREAS, to further secure payment of the Note and all other
Obligations of Radnet to DVI, Radnet delivered to DVI the guarantee (the
"GUARANTEE") of Primedex Health Systems, Inc. (the "GUARANTOR") (the "GUARANTEE"
together with the Loan and ancillary documents are, collectively the "LOAN
DOCUMENTS");
WHEREAS, substantially contemporaneously therewith, DVI
contributed all of the Loan Documents to DVI Receivables XI, L.L.C. ("DVI XI")
and thereafter pursuant to an Amended and Restated Indenture, DVI XI granted a
first priority security interest in and pledged all of the Loan Documents in
favor of U.S. Bank, N.A., as Trustee, for the benefit of a
#1231-035
noteholder which purchased asset backed promissory notes issued by DVI XI (the
"Noteholder");
WHEREAS, DVI contributed other Loans with Radnet or certain
affiliates of Radnet to this and other DVI securitizations (collectively the
"RELATED LOANS");
WHEREAS, Radnet is in default under the terms of the Loan;
WHEREAS, Radnet has requested USBPS to modify the Loan to
reflect an adjustment in payments;
WHEREAS, Radnet and/or certain of its affiliates have agreed
to modify the Related Loans;
WHEREAS, Radnet and certain of its affiliates are engaged in
negotiations to restructure or modify certain loan agreements, loans and
promissory notes with each of General Electric Capital Corporation ("GECC") and
DVI (with respect to GECC, the "GECC MODIFICATION", and with respect to DVI, the
"DVI MODIFICATION");
WHEREAS, subject to the following terms and conditions, USBPS
is willing to modify the Loan as hereinafter provided.
NOW, THEREFORE, the parties agree as follows:
1. All of the Whereas clauses are incorporated herein as if
hereinafter set forth at full length.
2. Radnet acknowledges that it is duly indebted to the Trustee
in the sum set forth on AMENDED AND RESTATED RIDER A annexed hereto, and has no
defenses, counterclaims or offsets to such indebtedness.
3. USBPS as Agent for the Trustee will modify the Loan to
provide for payments to commence in accordance with the attached revised payment
schedule (the
2
#1231-035
"AMENDED AND RESTATED RIDER A"). Radnet may, at any time, prepay all of the then
outstanding Obligations subject to an additional prepayment fee of 2% of such
Obligations. Partial prepayments of the Obligations shall not be permitted at
any time.
4. This Agreement shall become effective upon the date that
USBPS receives this Agreement duly executed by Radnet and the satisfaction of
each of the following conditions:
(a) Radnet and/or its affiliates shall have entered
into agreements on similar terms to this Agreement and
otherwise in form and substance satisfactory to USBPS,
relating to the Related Loans (the "Related Loan
Modifications");
(b) reimbursement of USBPS's legal fees incurred in
connection with the execution of this Agreement and the
Related Loan Modifications, aggregating $50,000, shall have
been received by USBPS;
(c) Radnet and/or its affiliates shall have entered
into the GECC Modification and the DVI Modification.
5. The closing of the restructuring of the Radnet Loan is
further subject to delivery to USBPS of all of the following, each in form and
substance satisfactory to USBPS and its counsel:
(a) The executed AMENDED AND RESTATED RIDER A;
(b) An executed copy of this Agreement;
(c) Such other documents, including UCC financing
statements as USBPS reasonably requests.
6. Radnet hereby acknowledges and agrees that it has no, and
will not assert any, defenses, counterclaims or offsets to the Loan and AMENDED
AND RESTATED RIDER A and acknowledges and agrees that the Trustee holds a
first-priority security interest in the Collateral.
7. Any default or other breach of any obligation under the
GECC Modification, the DVI Modification, or any of the Related Loan
Modifications shall constitute a
3
#1231-035
default under the Loan as modified by this Agreement, and USBPS shall have all
remedies thereunder.
8. Radnet hereby releases the Noteholder, USBPS individually
and as agent for the Trustee and the special purpose entities for which the
Trustee holds collateral, from and against any claims, loss or damage of any
kind or nature arising out of the Loan.
9. So long as any of the Obligations remain outstanding,
Radnet Management, Inc. (the "COMPANY") agrees as follows:
(i) FINANCIAL REPORTING. The Company shall furnish
the following documents or information to USBPS:
(A) Within 30 days after the end of each
Fiscal Quarter (as defined below) (i) (or 90 days in respect of the last month
of the fiscal year), the Company's consolidated, consolidating and on a center
by center basis, financial statements, including the most recent annual report,
balance sheet (not on a center by center basis) and income statement, prepared
in accordance with generally accepted accounting principles, which reports, the
Company warrants, shall fully and fairly represent the true financial condition
of the Company and (ii) updated projections for the Company and for each center;
(B) any other financial information normally
provided by the Company to the public; and
(C) Such other financial data or information
relative to this Amendment Agreement, including, without limitation, listings of
serial numbers or other identification data and confirmations of such
information, as USBPS may time-to-time reasonably request.
(ii) NO AMENDMENTS. Subsequent to the date of this
Amendment Agreement, the Company will not agree or consent to any amendments or
modifications to any agreement between the Company and DVI, GECC or Xxxxx Fargo
Foothill, Inc. ("FOOTHILL") containing terms (including, but not limited to,
increasing interest rates, accelerating the principal amortization or maturity,
new or more stringent defaults, additional collateral, and new remedies
provisions) that would be more onerous to the Company, or adversely impact or
affect GECC with respect to the terms of this Amendment Agreement.
(iii) DISTRIBUTIONS. The Company shall not make any
distribution or declare or pay any dividends (in cash or other property, other
than common stock) on, or purchase, acquire, redeem, or retire any of the
Company's stock, of any class, whether now or hereafter outstanding
(collectively, "DISTRIBUTIONS"); PROVIDED, HOWEVER, that so long as no
4
#1231-035
default shall have occurred and be continuing immediately prior to or after
giving effect to any such payment, (a) the Company may make Distributions to
Primedex Health Systems, Inc., a New York corporation (the "PARENT") (1) in
amounts necessary to pay customary expenses of Parent in the ordinary course of
its business as a public holding company (including salaries and related
reasonable and customary expenses incurred by employees of Parent) in an
aggregate amount not to exceed $750,000 in any fiscal year, (2) in amounts
necessary to enable Parent to pay taxes when due and owing by it in the ordinary
course of its business as a holding company and (3) in amounts necessary to
enable Parent to pay interest on those certain 11.5% Series A Convertible
Subordinated Notes due June 30, 2008, issued by Parent on June 25, 1993, and (b)
Parent may make Distributions in the form of common stock.
(iv) FIXED CHARGE COVERAGE RATIO. Commencing April
30, 2005, the Company shall not permit the Fixed Charge Coverage Ratio, (a) to
be less than 1.0:1 as of the end of each April, July, October and January (each,
a "FISCAL QUARTER") ending prior to January 1, 2007, and (b) to be less than
1.05:1 as of the last day of each Fiscal Quarter ending thereafter. "FIXED
CHARGE COVERAGE RATIO" means for any period, the ratio of (i) EBITDA for such
period minus cash capital expenditures made (to the extent not already incurred
in a prior period) or incurred during such period, to (ii) the sum of (a)
interest expense, (b) principal payments required to be paid during such period
in respect of indebtedness, and (c) all federal, state, and local income taxes
accrued, all as determined for the twelve months ending on the determination
date for the Company and its subsidiaries on a consolidated basis without
duplication and in accordance with generally accepted accounting principles
consistently applied. "EBITDA" means, with respect to any fiscal period, the
Company's and its subsidiaries' consolidated net earnings (or loss), minus
extraordinary gains and interest income, plus interest expense, income taxes,
and depreciation and amortization for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(v) LEVERAGE RATIO. The Company shall not permit the
Leverage Ratio, as determined as of the end of each Fiscal Quarter, to be
greater than the amount set forth in the following table for the Fiscal Quarters
ending in the period set forth opposite thereto:
LEVERAGE RATIO PERIOD
-------------- ------
4.50:1.0 04/30/05 - 10/30/05
4.30:1.0 10/31/05 - 10/30/06
4.00:1.0 10/31/06 - 10/30/07
3.80:1.0 10/31/07 - 10/30/08
"LEVERAGE RATIO" means, at any date of determination, the
ratio of (a) Total Debt at such date to (b) EBITDA for the applicable period
ending on such date. "TOTAL DEBT" means, as of any date of determination,
without duplication, the sum of (a) the outstanding aggregate amount of the
obligations for borrowed money, (b) the outstanding principal amount of capital
leases, (c) the outstanding principal amount of purchase money indebtedness, (d)
the outstanding principal amount of funded debt, and (e) the outstanding
principal amount of all obligations
5
#1231-035
owing to GECC, DVI and USBPS; all as determined for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(vi) EBITDA MARGIN. The Company shall not permit the
EBITDA Margin to be less than 25% as of the end of any Fiscal Quarter ending on
or after April 30, 2005. "EBITDA MARGIN" means for any period, the ratio of (a)
EBITDA for such period, to (b) net revenues (excluding the professional service
fee component of radiology services) for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(vii) RECEIVABLE DAYS. The Company shall not permit
the Receivable Days to exceed 65 days as of the end of any Fiscal Quarter ending
on or after April 30, 2005. "RECEIVABLE DAYS" means for any period, a number
equal to (a) 365 divided by (b) the result of (i) net revenues for such period
divided by (ii) net receivables for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(viii) NAME CHANGES, ETC. The Company agrees that it
shall not change its name or jurisdiction of organization without giving 30 days
prior written notice to USBPS.
10. To induce USBPS on behalf of the Trustee to enter this
Agreement, the Guarantor hereby affirms and restates its Guarantee as related to
this Loan and AMENDED AND RESTATED RIDER A.
11. Radnet, the Company and the Guarantor each represent and
warrant that each has been represented by an attorney of its choice and is fully
aware of the terms contained in this Agreement and AMENDED AND RESTATED RIDER A
to which it is a party which was voluntarily entered into without coercion or
duress of any kind.
12. Radnet represents and warrants to USBPS on behalf of the
Noteholders and Trustee that all necessary actions on the part of Radnet to be
taken in connection with the execution, delivery and performance of this
Agreement have been taken; the performance by Radnet of this Agreement and the
AMENDED AND RESTATED RIDER A will not violate any of
6
#1231-035
Radnet's Articles of Incorporation, Articles of Formation, Partnership Agreement
or other agreement or law by which Radnet is bound.
13. Any notice, request, direction, consent, approval, waiver
or other communication required or permitted under this Agreement to be sent
must be in writing and will become effective only upon delivery to USBPS at the
address set forth herein as follows:
U.S. Bank Portfolio Services
0000 Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxx, XX 00000
Attn: Xxxx Xxx, Director of Operations
14. Except as provided herein, and in the AMENDED AND RESTATED
RIDER A, all of the other provisions of the Loan Documents not restated will
remain in effect.
15. This Agreement and the documents referenced herein
constitute the entire and final agreement among the parties with respect to the
subject matter hereof and there are no agreements, understandings, warranties or
representations among the parties with respect to these matters except as set
forth herein.
16. This Agreement will inure to the benefit of and bind the
parties and their respective successors and permitted assigns.
17. Neither this Agreement nor any of the provisions hereof
can be changed, waived, discharged or terminated except by an instrument in
writing signed by the parties against whom such enforcement of the change,
waiver, discharge or termination is sought.
18. This Agreement will be interpreted and construed under the
laws of the Commonwealth of Pennsylvania, regardless of the domicile of any
party and will be considered to have been made, executed and performed in
Pennsylvania.
7
#1231-035
19. THE UNDERSIGNED, AND SUBJECT TO THE PROVISIONS CONTAINED
HEREIN, USBPS FOR ITSELF AND AS AGENT FOR THE TRUSTEE, (A) AGREE TO SUBMIT FOR
THEMSELVES, IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT AND ANY
SCHEDULE OR FOR RECOGNITION AND ENFORCEMENT OF ANY JUDGMENT IN RESPECT HEREOF OR
THEREOF, TO THE EXCLUSIVE JURISDICTION OF THE COURTS OF THE COMONWEALTH OF
PENNSYLVANIA, THE COURTS OF THE UNITED STATES OF AMERICA FOR THE EASTERN
DISTRICT OF PENNSYLVANIA, AND APPELLATE COURTS FROM ANY THEREOF, (B) CONSENT
THAT ANY ACTION OR PROCEEDING SHALL BE BROUGHT IN SUCH COURTS, AND WAIVE ANY
OBJECTION THAT EACH MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH ACTION OR
PROCEEDING IN ANY SUCH COURT, (C) AGREE THAT SERVICE OF PROCESS OF ANY SUCH
ACTION OR PROCEEDING MAY BE EFFECTED BY CERTIFIED MAIL (OR ANY SUBSTANTIALLY
SIMILAR FORM OF MAIL), POSTAGE PREPAID, TO THE APPROPRIATE PARTY AT ITS ADDRESS
AS SET FORTH HEREIN, AND SERVICE MADE SHALL BE DEEMED TO BE COMPLETED UPON THE
EARLIER OF ACTUAL RECEIPT OR FIVE (5) DAYS AFTER THE SAME SHALL HAVE BEEN POSTED
AS AFORESAID, AND (D) AGREE THAT NOTHING HEREIN OR IN ANY EXHIBIT OR SCHEDULE
SHALL AFFECT THE RIGHT TO EFFECT SERVICE OF PROCESS IN ANY OTHER MANNER
PERMITTED BY LAW. USBPS AND THE UNDERSIGNED EACH HEREBY UNCONDITIONALLY WAIVES
ITS RIGHT TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING
OUT OF, DIRECTLY OR INDIRECTLY, THIS AGREEMENT, ANY EXHIBIT AND THE TRANSACTIONS
8
#1231-035
CONTEMPLATED HEREBY AND THEREBY, ANY OF THE RELATED DOCUMENTS, ANY DEALINGS
BETWEEN THE PARTIES HERETO RELATING TO THE SUBJECT MATTER HEREOF OR THEREOF,
AND/OR THE RELATIONSHIP THAT IS BEING ESTABLISHED BETWEEN USBPS AS AGENT FOR THE
TRUSTEE AND THE UNDERSIGNED, PROVIDED USBPS MAY IN ITS DISCRETION ENFORCE THE
TERMS OF THE FORUM SELECTION PROVISIONS IN THE LOANS.
20. Radnet, the Company and the Guarantor hereby release
USBPS, the Trustee, and the Noteholders from and against any claim, loss, or
damage arising out of the negotiation execution, and performance of the Loan or
related matters prior to the date hereof.
21. This Agreement may be executed in two or more counterparts
and each counterpart shall be deemed an original.
9
#1231-035
LYON FINANCIAL SERVICES, INC. DBA U.S.
BANK PORTFOLIO SERVICES, AS SUCCESSOR
SERVICER FOR DVI RECEIVABLES XI, L.L.C.
AND AS AGENT FOR U.S. BANK, N.A., AS TRUSTEE
By: ________________________________________
RADNET MANAGEMENT, INC.
By: ________________________________________
ACKNOWLEDGED AND AGREED TO:
Primedex Health Systems, Inc., Guarantor
By: ____________________________________
10
#1231-034
AMENDMENT TO LOAN DOCUMENTS
---------------------------
AGREEMENT made as of June 30, 2004 ("AMENDMENT AGREEMENT" or
"AGREEMENT") by and between LYON FINANCIAL SERVICES, INC. DBA U.S. BANK
PORTFOLIO SERVICES, as Successor Servicer for DVI Receivables XI, L.L.C. and as
Agent for U.S. Bank, N.A., as Trustee, with offices at 0000 Xxxxxx Xxxxxx, Xxxxx
000, Xxxxxxxx, Xxxxxxxxx 00000 ("USBPS") and Radnet Management, Inc., a
corporation, with offices at 0000 Xxxxxx Xxxxxx, Xxx Xxxxxxx, XX 00000
("RADNET"), and such other signatories hereto.
WHEREAS, on or about Xxxxx 00, 0000, Xxxxxx executed and
delivered to DVI Financial Services Inc. ("DVI") a Loan and Security Agreement
collectively with the Schedule Number #1231-034 dated June 28, 1999 (the
"LOAN");
WHEREAS, to secure the payment of the Loan and all other
obligations of Radnet to DVI (collectively the "OBLIGATIONS"), Radnet, pursuant
to a Security Agreement dated on or about December 15, 1997 (the "SECURITY
AGREEMENT"), granted DVI a first priority security interest in certain
Collateral described therein;
WHEREAS, to further secure payment of the Note and all other
Obligations of Radnet to DVI, Radnet delivered to DVI the guarantee (the
"GUARANTEE") of Primedex Health Systems, Inc. (the "GUARANTOR") (the "GUARANTEE"
together with the Loan and ancillary documents are, collectively the "LOAN
DOCUMENTS");
WHEREAS, substantially contemporaneously therewith, DVI
contributed all of the Loan Documents to DVI Receivables XI, L.L.C. ("DVI XI")
and thereafter pursuant to an Amended and Restated Indenture, DVI XI granted a
first priority security interest in and pledged all of the Loan Documents in
favor of U.S. Bank, N.A., as Trustee, for the benefit of a
#1231-034
noteholder which purchased asset backed promissory notes issued by DVI XI (the
"Noteholder");
WHEREAS, DVI contributed other Loans with Radnet or certain
affiliates of Radnet to this and other DVI securitizations (collectively the
"RELATED LOANS");
WHEREAS, Radnet is in default under the terms of the Loan;
WHEREAS, Radnet has requested USBPS to modify the Loan to
reflect an adjustment in payments;
WHEREAS, Radnet and/or certain of its affiliates have agreed
to modify the Related Loans;
WHEREAS, Radnet and certain of its affiliates are engaged in
negotiations to restructure or modify certain loan agreements, loans and
promissory notes with each of General Electric Capital Corporation ("GECC") and
DVI (with respect to GECC, the "GECC MODIFICATION", and with respect to DVI, the
"DVI MODIFICATION");
WHEREAS, subject to the following terms and conditions, USBPS
is willing to modify the Loan as hereinafter provided.
NOW, THEREFORE, the parties agree as follows:
1. All of the Whereas clauses are incorporated herein as if
hereinafter set forth at full length.
2. Radnet acknowledges that it is duly indebted to the Trustee
in the sum set forth on AMENDED AND RESTATED RIDER A annexed hereto, and has no
defenses, counterclaims or offsets to such indebtedness.
3. USBPS as Agent for the Trustee will modify the Loan to
provide for payments to commence in accordance with the attached revised payment
schedule (the
2
#1231-034
"AMENDED AND RESTATED RIDER A"). Radnet may, at any time, prepay all of the then
outstanding Obligations subject to an additional prepayment fee of 2% of such
Obligations. Partial prepayments of the Obligations shall not be permitted at
any time.
4. This Agreement shall become effective upon the date that
USBPS receives this Agreement duly executed by Radnet and the satisfaction of
each of the following conditions:
(a) Radnet and/or its affiliates shall have entered
into agreements on similar terms to this Agreement and
otherwise in form and substance satisfactory to USBPS,
relating to the Related Loans (the "Related Loan
Modifications");
(b) reimbursement of USBPS's legal fees incurred in
connection with the execution of this Agreement and the
Related Loan Modifications, aggregating $50,000, shall have
been received by USBPS;
(c) Radnet and/or its affiliates shall have entered
into the GECC Modification and the DVI Modification.
5. The closing of the restructuring of the Radnet Loan is
further subject to delivery to USBPS of all of the following, each in form and
substance satisfactory to USBPS and its counsel:
(a) The executed AMENDED AND RESTATED RIDER A;
(b) An executed copy of this Agreement;
(c) Such other documents, including UCC financing
statements as USBPS reasonably requests.
6. Radnet hereby acknowledges and agrees that it has no, and
will not assert any, defenses, counterclaims or offsets to the Loan and AMENDED
AND RESTATED RIDER A and acknowledges and agrees that the Trustee holds a
first-priority security interest in the Collateral.
7. Any default or other breach of any obligation under the
GECC Modification, the DVI Modification, or any of the Related Loan
Modifications shall constitute a
3
#1231-034
default under the Loan as modified by this Agreement, and USBPS shall have all
remedies thereunder.
8. Radnet hereby releases the Noteholder, USBPS individually
and as agent for the Trustee and the special purpose entities for which the
Trustee holds collateral, from and against any claims, loss or damage of any
kind or nature arising out of the Loan.
9. So long as any of the Obligations remain outstanding,
Radnet Management, Inc. (the "COMPANY") agrees as follows:
(i) FINANCIAL REPORTING. The Company shall furnish
the following documents or information to USBPS:
(A) Within 30 days after the end of each
Fiscal Quarter (as defined below) (i) (or 90 days in respect of the last month
of the fiscal year), the Company's consolidated, consolidating and on a center
by center basis, financial statements, including the most recent annual report,
balance sheet (not on a center by center basis) and income statement, prepared
in accordance with generally accepted accounting principles, which reports, the
Company warrants, shall fully and fairly represent the true financial condition
of the Company and (ii) updated projections for the Company and for each center;
(B) any other financial information normally
provided by the Company to the public; and
(C) Such other financial data or information
relative to this Amendment Agreement, including, without limitation, listings of
serial numbers or other identification data and confirmations of such
information, as USBPS may time-to-time reasonably request.
(ii) NO AMENDMENTS. Subsequent to the date of this
Amendment Agreement, the Company will not agree or consent to any amendments or
modifications to any agreement between the Company and DVI, GECC or Xxxxx Fargo
Foothill, Inc. ("FOOTHILL") containing terms (including, but not limited to,
increasing interest rates, accelerating the principal amortization or maturity,
new or more stringent defaults, additional collateral, and new remedies
provisions) that would be more onerous to the Company, or adversely impact or
affect GECC with respect to the terms of this Amendment Agreement.
(iii) DISTRIBUTIONS. The Company shall not make any
distribution or declare or pay any dividends (in cash or other property, other
than common stock) on, or purchase, acquire, redeem, or retire any of the
Company's stock, of any class, whether now or hereafter outstanding
(collectively, "DISTRIBUTIONS"); PROVIDED, HOWEVER, that so long as no
4
#1231-034
default shall have occurred and be continuing immediately prior to or after
giving effect to any such payment, (a) the Company may make Distributions to
Primedex Health Systems, Inc., a New York corporation (the "PARENT") (1) in
amounts necessary to pay customary expenses of Parent in the ordinary course of
its business as a public holding company (including salaries and related
reasonable and customary expenses incurred by employees of Parent) in an
aggregate amount not to exceed $750,000 in any fiscal year, (2) in amounts
necessary to enable Parent to pay taxes when due and owing by it in the ordinary
course of its business as a holding company and (3) in amounts necessary to
enable Parent to pay interest on those certain 11.5% Series A Convertible
Subordinated Notes due June 30, 2008, issued by Parent on June 25, 1993, and (b)
Parent may make Distributions in the form of common stock.
(iv) FIXED CHARGE COVERAGE RATIO. Commencing April
30, 2005, the Company shall not permit the Fixed Charge Coverage Ratio, (a) to
be less than 1.0:1 as of the end of each April, July, October and January (each,
a "FISCAL QUARTER") ending prior to January 1, 2007, and (b) to be less than
1.05:1 as of the last day of each Fiscal Quarter ending thereafter. "FIXED
CHARGE COVERAGE RATIO" means for any period, the ratio of (i) EBITDA for such
period minus cash capital expenditures made (to the extent not already incurred
in a prior period) or incurred during such period, to (ii) the sum of (a)
interest expense, (b) principal payments required to be paid during such period
in respect of indebtedness, and (c) all federal, state, and local income taxes
accrued, all as determined for the twelve months ending on the determination
date for the Company and its subsidiaries on a consolidated basis without
duplication and in accordance with generally accepted accounting principles
consistently applied. "EBITDA" means, with respect to any fiscal period, the
Company's and its subsidiaries' consolidated net earnings (or loss), minus
extraordinary gains and interest income, plus interest expense, income taxes,
and depreciation and amortization for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(v) LEVERAGE RATIO. The Company shall not permit the
Leverage Ratio, as determined as of the end of each Fiscal Quarter, to be
greater than the amount set forth in the following table for the Fiscal Quarters
ending in the period set forth opposite thereto:
LEVERAGE RATIO PERIOD
-------------- ------
4.50:1.0 04/30/05 - 10/30/05
4.30:1.0 10/31/05 - 10/30/06
4.00:1.0 10/31/06 - 10/30/07
3.80:1.0 10/31/07 - 10/30/08
"LEVERAGE RATIO" means, at any date of determination, the
ratio of (a) Total Debt at such date to (b) EBITDA for the applicable period
ending on such date. "TOTAL DEBT" means, as of any date of determination,
without duplication, the sum of (a) the outstanding aggregate amount of the
obligations for borrowed money, (b) the outstanding principal amount of capital
leases, (c) the outstanding principal amount of purchase money indebtedness, (d)
the outstanding principal amount of funded debt, and (e) the outstanding
principal amount of all obligations
5
#1231-034
owing to GECC, DVI and USBPS; all as determined for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(vi) EBITDA MARGIN. The Company shall not permit the
EBITDA Margin to be less than 25% as of the end of any Fiscal Quarter ending on
or after April 30, 2005. "EBITDA MARGIN" means for any period, the ratio of (a)
EBITDA for such period, to (b) net revenues (excluding the professional service
fee component of radiology services) for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(vii) RECEIVABLE DAYS. The Company shall not permit
the Receivable Days to exceed 65 days as of the end of any Fiscal Quarter ending
on or after April 30, 2005. "RECEIVABLE DAYS" means for any period, a number
equal to (a) 365 divided by (b) the result of (i) net revenues for such period
divided by (ii) net receivables for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(viii) NAME CHANGES, ETC. The Company agrees that it
shall not change its name or jurisdiction of organization without giving 30 days
prior written notice to USBPS.
10. To induce USBPS on behalf of the Trustee to enter this
Agreement, the Guarantor hereby affirms and restates its Guarantee as related to
this Loan and AMENDED AND RESTATED RIDER A.
11. Radnet, the Company and the Guarantor each represent and
warrant that each has been represented by an attorney of its choice and is fully
aware of the terms contained in this Agreement and AMENDED AND RESTATED RIDER A
to which it is a party which was voluntarily entered into without coercion or
duress of any kind.
12. Radnet represents and warrants to USBPS on behalf of the
Noteholders and Trustee that all necessary actions on the part of Radnet to be
taken in connection with the execution, delivery and performance of this
Agreement have been taken; the performance by Radnet of this Agreement and the
AMENDED AND RESTATED RIDER A will not violate any of
6
#1231-034
Radnet's Articles of Incorporation, Articles of Formation, Partnership Agreement
or other agreement or law by which Radnet is bound.
13. Any notice, request, direction, consent, approval, waiver
or other communication required or permitted under this Agreement to be sent
must be in writing and will become effective only upon delivery to USBPS at the
address set forth herein as follows:
U.S. Bank Portfolio Services
0000 Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxx, XX 00000
Attn: Xxxx Xxx, Director of Operations
14. Except as provided herein, and in the AMENDED AND RESTATED
RIDER A, all of the other provisions of the Loan Documents not restated will
remain in effect.
15. This Agreement and the documents referenced herein
constitute the entire and final agreement among the parties with respect to the
subject matter hereof and there are no agreements, understandings, warranties or
representations among the parties with respect to these matters except as set
forth herein.
16. This Agreement will inure to the benefit of and bind the
parties and their respective successors and permitted assigns.
17. Neither this Agreement nor any of the provisions hereof
can be changed, waived, discharged or terminated except by an instrument in
writing signed by the parties against whom such enforcement of the change,
waiver, discharge or termination is sought.
18. This Agreement will be interpreted and construed under the
laws of the Commonwealth of Pennsylvania, regardless of the domicile of any
party and will be considered to have been made, executed and performed in
Pennsylvania.
7
#1231-034
19. THE UNDERSIGNED, AND SUBJECT TO THE PROVISIONS CONTAINED
HEREIN, USBPS FOR ITSELF AND AS AGENT FOR THE TRUSTEE, (A) AGREE TO SUBMIT FOR
THEMSELVES, IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT AND ANY
SCHEDULE OR FOR RECOGNITION AND ENFORCEMENT OF ANY JUDGMENT IN RESPECT HEREOF OR
THEREOF, TO THE EXCLUSIVE JURISDICTION OF THE COURTS OF THE COMONWEALTH OF
PENNSYLVANIA, THE COURTS OF THE UNITED STATES OF AMERICA FOR THE EASTERN
DISTRICT OF PENNSYLVANIA, AND APPELLATE COURTS FROM ANY THEREOF, (B) CONSENT
THAT ANY ACTION OR PROCEEDING SHALL BE BROUGHT IN SUCH COURTS, AND WAIVE ANY
OBJECTION THAT EACH MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH ACTION OR
PROCEEDING IN ANY SUCH COURT, (C) AGREE THAT SERVICE OF PROCESS OF ANY SUCH
ACTION OR PROCEEDING MAY BE EFFECTED BY CERTIFIED MAIL (OR ANY SUBSTANTIALLY
SIMILAR FORM OF MAIL), POSTAGE PREPAID, TO THE APPROPRIATE PARTY AT ITS ADDRESS
AS SET FORTH HEREIN, AND SERVICE MADE SHALL BE DEEMED TO BE COMPLETED UPON THE
EARLIER OF ACTUAL RECEIPT OR FIVE (5) DAYS AFTER THE SAME SHALL HAVE BEEN POSTED
AS AFORESAID, AND (D) AGREE THAT NOTHING HEREIN OR IN ANY EXHIBIT OR SCHEDULE
SHALL AFFECT THE RIGHT TO EFFECT SERVICE OF PROCESS IN ANY OTHER MANNER
PERMITTED BY LAW. USBPS AND THE UNDERSIGNED EACH HEREBY UNCONDITIONALLY WAIVES
ITS RIGHT TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING
OUT OF, DIRECTLY OR INDIRECTLY, THIS AGREEMENT, ANY EXHIBIT AND THE TRANSACTIONS
8
#1231-034
CONTEMPLATED HEREBY AND THEREBY, ANY OF THE RELATED DOCUMENTS, ANY DEALINGS
BETWEEN THE PARTIES HERETO RELATING TO THE SUBJECT MATTER HEREOF OR THEREOF,
AND/OR THE RELATIONSHIP THAT IS BEING ESTABLISHED BETWEEN USBPS AS AGENT FOR THE
TRUSTEE AND THE UNDERSIGNED, PROVIDED USBPS MAY IN ITS DISCRETION ENFORCE THE
TERMS OF THE FORUM SELECTION PROVISIONS IN THE LOANS.
20. Radnet, the Company and the Guarantor hereby release
USBPS, the Trustee, and the Noteholders from and against any claim, loss, or
damage arising out of the negotiation execution, and performance of the Loan or
related matters prior to the date hereof.
21. This Agreement may be executed in two or more counterparts
and each counterpart shall be deemed an original.
9
#1231-034
LYON FINANCIAL SERVICES, INC. DBA U.S.
BANK PORTFOLIO SERVICES, AS SUCCESSOR
SERVICER FOR DVI RECEIVABLES XI, L.L.C.
AND AS AGENT FOR U.S. BANK, N.A., AS TRUSTEE
By: ________________________________________
RADNET MANAGEMENT, INC.
By: ________________________________________
ACKNOWLEDGED AND AGREED TO:
Primedex Health Systems, Inc., Guarantor
By: ____________________________________
10
#1231-032
AMENDMENT TO LOAN DOCUMENTS
---------------------------
AGREEMENT made as of June 30, 2004 ("AMENDMENT AGREEMENT" or
"AGREEMENT") by and between LYON FINANCIAL SERVICES, INC. DBA U.S. BANK
PORTFOLIO SERVICES, as Successor Servicer for DVI Receivables VIII, L.L.C. and
as Agent for U.S. Bank, N.A., as Trustee, with offices at 0000 Xxxxxx Xxxxxx,
Xxxxx 000, Xxxxxxxx, Xxxxxxxxx 00000 ("USBPS") and Radnet Management, Inc., a
corporation, with offices at 0000 Xxxxxx Xxxxxx, Xxx Xxxxxxx, XX 00000
("RADNET"), and such other signatories hereto.
WHEREAS, on or about Xxxxx 00, 0000, Xxxxxx executed and
delivered to DVI Financial Services Inc. ("DVI") a Loan and Security Agreement
collectively with the Schedule Number #1231-032 dated August 31, 1998 (the
"LOAN");
WHEREAS, to secure the payment of the Loan and all other
obligations of Radnet to DVI (collectively the "OBLIGATIONS"), Radnet, pursuant
to a Security Agreement dated on or about December 15, 1997 (the "SECURITY
AGREEMENT"), granted DVI a first priority security interest in certain
Collateral described therein;
WHEREAS, to further secure payment of the Note and all other
Obligations of Radnet to DVI, Radnet delivered to DVI the guarantee (the
"GUARANTEE") of Primedex Health Systems, Inc. (the "GUARANTOR") (the "GUARANTEE"
together with the Loan and ancillary documents are, collectively the "LOAN
DOCUMENTS");
WHEREAS, substantially contemporaneously therewith, DVI
contributed all of the Loan Documents to DVI Receivables VIII, L.L.C. ("DVI
VIII") and thereafter pursuant to an Amended and Restated Indenture, DVI VIII
granted a first priority security interest in and pledged all of the Loan
Documents in favor of U.S. Bank, N.A., as Trustee, for the benefit of a
#1231-032
noteholder which purchased asset backed promissory notes issued by DVI VIII (the
"Noteholder");
WHEREAS, DVI contributed other Loans with Radnet or certain
affiliates of Radnet to this and other DVI securitizations (collectively the
"RELATED LOANS");
WHEREAS, Radnet is in default under the terms of the Loan;
WHEREAS, Radnet has requested USBPS to modify the Loan to
reflect an adjustment in payments;
WHEREAS, Radnet and/or certain of its affiliates have agreed
to modify the Related Loans;
WHEREAS, Radnet and certain of its affiliates are engaged in
negotiations to restructure or modify certain loan agreements, loans and
promissory notes with each of General Electric Capital Corporation ("GECC") and
DVI (with respect to GECC, the "GECC MODIFICATION", and with respect to DVI, the
"DVI MODIFICATION");
WHEREAS, subject to the following terms and conditions, USBPS
is willing to modify the Loan as hereinafter provided.
NOW, THEREFORE, the parties agree as follows:
1. All of the Whereas clauses are incorporated herein as if
hereinafter set forth at full length.
2. Radnet acknowledges that it is duly indebted to the Trustee
in the sum set forth on AMENDED AND RESTATED RIDER A annexed hereto, and has no
defenses, counterclaims or offsets to such indebtedness.
3. USBPS as Agent for the Trustee will modify the Loan to
provide for payments to commence in accordance with the attached revised payment
schedule (the
2
#1231-032
"AMENDED AND RESTATED RIDER A"). Radnet may, at any time, prepay all of the then
outstanding Obligations subject to an additional prepayment fee of 2% of such
Obligations. Partial prepayments of the Obligations shall not be permitted at
any time.
4. This Agreement shall become effective upon the date that
USBPS receives this Agreement duly executed by Radnet and the satisfaction of
each of the following conditions:
(a) Radnet and/or its affiliates shall have entered
into agreements on similar terms to this Agreement and
otherwise in form and substance satisfactory to USBPS,
relating to the Related Loans (the "Related Loan
Modifications");
(b) reimbursement of USBPS's legal fees incurred in
connection with the execution of this Agreement and the
Related Loan Modifications, aggregating $50,000, shall have
been received by USBPS;
(c) Radnet and/or its affiliates shall have entered
into the GECC Modification and the DVI Modification.
5. The closing of the restructuring of the Radnet Loan is
further subject to delivery to USBPS of all of the following, each in form and
substance satisfactory to USBPS and its counsel:
(a) The executed AMENDED AND RESTATED RIDER A;
(b) An executed copy of this Agreement;
(c) Such other documents, including UCC financing
statements as USBPS reasonably requests.
6. Radnet hereby acknowledges and agrees that it has no, and
will not assert any, defenses, counterclaims or offsets to the Loan and AMENDED
AND RESTATED RIDER A and acknowledges and agrees that the Trustee holds a
first-priority security interest in the Collateral.
7. Any default or other breach of any obligation under the
GECC Modification, the DVI Modification, or any of the Related Loan
Modifications shall constitute a
3
#1231-032
default under the Loan as modified by this Agreement, and USBPS shall have all
remedies thereunder.
8. Radnet hereby releases the Noteholder, USBPS individually
and as agent for the Trustee and the special purpose entities for which the
Trustee holds collateral, from and against any claims, loss or damage of any
kind or nature arising out of the Loan.
9. So long as any of the Obligations remain outstanding,
Radnet Management, Inc. (the "COMPANY") agrees as follows:
(i) FINANCIAL REPORTING. The Company shall furnish
the following documents or information to USBPS:
(A) Within 30 days after the end of each
Fiscal Quarter (as defined below) (i) (or 90 days in respect of the last month
of the fiscal year), the Company's consolidated, consolidating and on a center
by center basis, financial statements, including the most recent annual report,
balance sheet (not on a center by center basis) and income statement, prepared
in accordance with generally accepted accounting principles, which reports, the
Company warrants, shall fully and fairly represent the true financial condition
of the Company and (ii) updated projections for the Company and for each center;
(B) any other financial information normally
provided by the Company to the public; and
(C) Such other financial data or information
relative to this Amendment Agreement, including, without limitation, listings of
serial numbers or other identification data and confirmations of such
information, as USBPS may time-to-time reasonably request.
(ii) NO AMENDMENTS. Subsequent to the date of this
Amendment Agreement, the Company will not agree or consent to any amendments or
modifications to any agreement between the Company and DVI, GECC or Xxxxx Fargo
Foothill, Inc. ("FOOTHILL") containing terms (including, but not limited to,
increasing interest rates, accelerating the principal amortization or maturity,
new or more stringent defaults, additional collateral, and new remedies
provisions) that would be more onerous to the Company, or adversely impact or
affect GECC with respect to the terms of this Amendment Agreement.
(iii) DISTRIBUTIONS. The Company shall not make any
distribution or declare or pay any dividends (in cash or other property, other
than common stock) on, or purchase, acquire, redeem, or retire any of the
Company's stock, of any class, whether now or hereafter outstanding
(collectively, "DISTRIBUTIONS"); PROVIDED, HOWEVER, that so long as no
4
#1231-032
default shall have occurred and be continuing immediately prior to or after
giving effect to any such payment, (a) the Company may make Distributions to
Primedex Health Systems, Inc., a New York corporation (the "PARENT") (1) in
amounts necessary to pay customary expenses of Parent in the ordinary course of
its business as a public holding company (including salaries and related
reasonable and customary expenses incurred by employees of Parent) in an
aggregate amount not to exceed $750,000 in any fiscal year, (2) in amounts
necessary to enable Parent to pay taxes when due and owing by it in the ordinary
course of its business as a holding company and (3) in amounts necessary to
enable Parent to pay interest on those certain 11.5% Series A Convertible
Subordinated Notes due June 30, 2008, issued by Parent on June 25, 1993, and (b)
Parent may make Distributions in the form of common stock.
(iv) FIXED CHARGE COVERAGE RATIO. Commencing April
30, 2005, the Company shall not permit the Fixed Charge Coverage Ratio, (a) to
be less than 1.0:1 as of the end of each April, July, October and January (each,
a "FISCAL QUARTER") ending prior to January 1, 2007, and (b) to be less than
1.05:1 as of the last day of each Fiscal Quarter ending thereafter. "FIXED
CHARGE COVERAGE RATIO" means for any period, the ratio of (i) EBITDA for such
period MINUS cash capital expenditures made (to the extent not already incurred
in a prior period) or incurred during such period, to (ii) the sum of (a)
interest expense, (b) principal payments required to be paid during such period
in respect of indebtedness, and (c) all federal, state, and local income taxes
accrued, all as determined for the twelve months ending on the determination
date for the Company and its subsidiaries on a consolidated basis without
duplication and in accordance with generally accepted accounting principles
consistently applied. "EBITDA" means, with respect to any fiscal period, the
Company's and its subsidiaries' consolidated net earnings (or loss), minus
extraordinary gains and interest income, plus interest expense, income taxes,
and depreciation and amortization for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(v) LEVERAGE RATIO. The Company shall not permit the
Leverage Ratio, as determined as of the end of each Fiscal Quarter, to be
greater than the amount set forth in the following table for the Fiscal Quarters
ending in the period set forth opposite thereto:
LEVERAGE RATIO PERIOD
-------------- ------
4.50:1.0 04/30/05 - 10/30/05
4.30:1.0 10/31/05 - 10/30/06
4.00:1.0 10/31/06 - 10/30/07
3.80:1.0 10/31/07 - 10/30/08
"LEVERAGE RATIO" means, at any date of determination, the
ratio of (a) Total Debt at such date to (b) EBITDA for the applicable period
ending on such date. "TOTAL DEBT" means, as of any date of determination,
without duplication, the sum of (a) the outstanding aggregate amount of the
obligations for borrowed money, (b) the outstanding principal amount of capital
leases, (c) the outstanding principal amount of purchase money indebtedness, (d)
the outstanding principal amount of funded debt, and (e) the outstanding
principal amount of all obligations
5
#1231-032
owing to GECC, DVI and USBPS; all as determined for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(vi) EBITDA MARGIN. The Company shall not permit the
EBITDA Margin to be less than 25% as of the end of any Fiscal Quarter ending on
or after April 30, 2005. "EBITDA MARGIN" means for any period, the ratio of (a)
EBITDA for such period, to (b) net revenues (excluding the professional service
fee component of radiology services) for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(vii) RECEIVABLE DAYS. The Company shall not permit
the Receivable Days to exceed 65 days as of the end of any Fiscal Quarter ending
on or after April 30, 2005. "RECEIVABLE DAYS" means for any period, a number
equal to (a) 365 divided by (b) the result of (i) net revenues for such period
divided by (ii) net receivables for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(viii) NAME CHANGES, ETC. The Company agrees that it
shall not change its name or jurisdiction of organization without giving 30 days
prior written notice to USBPS.
10. To induce USBPS on behalf of the Trustee to enter this
Agreement, the Guarantor hereby affirms and restates its Guarantee as related to
this Loan and AMENDED AND RESTATED RIDER A.
11. Radnet, the Company and the Guarantor each represent and
warrant that each has been represented by an attorney of its choice and is fully
aware of the terms contained in this Agreement and AMENDED AND RESTATED RIDER A
to which it is a party which was voluntarily entered into without coercion or
duress of any kind.
12. Radnet represents and warrants to USBPS on behalf of the
Noteholders and Trustee that all necessary actions on the part of Radnet to be
taken in connection with the execution, delivery and performance of this
Agreement have been taken; the performance by Radnet of this Agreement and the
AMENDED AND RESTATED RIDER A will not violate any of
6
#1231-032
Radnet's Articles of Incorporation, Articles of Formation, Partnership Agreement
or other agreement or law by which Radnet is bound.
13. Any notice, request, direction, consent, approval, waiver
or other communication required or permitted under this Agreement to be sent
must be in writing and will become effective only upon delivery to USBPS at the
address set forth herein as follows:
U.S. Bank Portfolio Services
0000 Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxx, XX 00000
Attn: Xxxx Xxx, Director of Operations
14. Except as provided herein, and in the AMENDED AND RESTATED
RIDER A, all of the other provisions of the Loan Documents not restated will
remain in effect.
15. This Agreement and the documents referenced herein
constitute the entire and final agreement among the parties with respect to the
subject matter hereof and there are no agreements, understandings, warranties or
representations among the parties with respect to these matters except as set
forth herein.
16. This Agreement will inure to the benefit of and bind the
parties and their respective successors and permitted assigns.
17. Neither this Agreement nor any of the provisions hereof
can be changed, waived, discharged or terminated except by an instrument in
writing signed by the parties against whom such enforcement of the change,
waiver, discharge or termination is sought.
18. This Agreement will be interpreted and construed under the
laws of the Commonwealth of Pennsylvania, regardless of the domicile of any
party and will be considered to have been made, executed and performed in
Pennsylvania.
7
#1231-032
19. THE UNDERSIGNED, AND SUBJECT TO THE PROVISIONS CONTAINED
HEREIN, USBPS FOR ITSELF AND AS AGENT FOR THE TRUSTEE, (A) AGREE TO SUBMIT FOR
THEMSELVES, IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT AND ANY
SCHEDULE OR FOR RECOGNITION AND ENFORCEMENT OF ANY JUDGMENT IN RESPECT HEREOF OR
THEREOF, TO THE EXCLUSIVE JURISDICTION OF THE COURTS OF THE COMONWEALTH OF
PENNSYLVANIA, THE COURTS OF THE UNITED STATES OF AMERICA FOR THE EASTERN
DISTRICT OF PENNSYLVANIA, AND APPELLATE COURTS FROM ANY THEREOF, (B) CONSENT
THAT ANY ACTION OR PROCEEDING SHALL BE BROUGHT IN SUCH COURTS, AND WAIVE ANY
OBJECTION THAT EACH MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH ACTION OR
PROCEEDING IN ANY SUCH COURT, (C) AGREE THAT SERVICE OF PROCESS OF ANY SUCH
ACTION OR PROCEEDING MAY BE EFFECTED BY CERTIFIED MAIL (OR ANY SUBSTANTIALLY
SIMILAR FORM OF MAIL), POSTAGE PREPAID, TO THE APPROPRIATE PARTY AT ITS ADDRESS
AS SET FORTH HEREIN, AND SERVICE MADE SHALL BE DEEMED TO BE COMPLETED UPON THE
EARLIER OF ACTUAL RECEIPT OR FIVE (5) DAYS AFTER THE SAME SHALL HAVE BEEN POSTED
AS AFORESAID, AND (D) AGREE THAT NOTHING HEREIN OR IN ANY EXHIBIT OR SCHEDULE
SHALL AFFECT THE RIGHT TO EFFECT SERVICE OF PROCESS IN ANY OTHER MANNER
PERMITTED BY LAW. USBPS AND THE UNDERSIGNED EACH HEREBY UNCONDITIONALLY WAIVES
ITS RIGHT TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING
OUT OF, DIRECTLY OR INDIRECTLY, THIS AGREEMENT, ANY EXHIBIT AND THE TRANSACTIONS
8
#1231-032
CONTEMPLATED HEREBY AND THEREBY, ANY OF THE RELATED DOCUMENTS, ANY DEALINGS
BETWEEN THE PARTIES HERETO RELATING TO THE SUBJECT MATTER HEREOF OR THEREOF,
AND/OR THE RELATIONSHIP THAT IS BEING ESTABLISHED BETWEEN USBPS AS AGENT FOR THE
TRUSTEE AND THE UNDERSIGNED, PROVIDED USBPS MAY IN ITS DISCRETION ENFORCE THE
TERMS OF THE FORUM SELECTION PROVISIONS IN THE LOANS.
20. Radnet, the Company and the Guarantor hereby release
USBPS, the Trustee, and the Noteholders from and against any claim, loss, or
damage arising out of the negotiation execution, and performance of the Loan or
related matters prior to the date hereof.
21. This Agreement may be executed in two or more counterparts
and each counterpart shall be deemed an original.
9
#1231-032
LYON FINANCIAL SERVICES, INC. DBA U.S.
BANK PORTFOLIO SERVICES, AS SUCCESSOR
SERVICER FOR DVI RECEIVABLES VIII, L.L.C.
AND AS AGENT FOR U.S. BANK, N.A., AS TRUSTEE
By: ________________________________________
RADNET MANAGEMENT, INC.
By: ________________________________________
ACKNOWLEDGED AND AGREED TO:
Primedex Health Systems, Inc., Guarantor
By: ____________________________________
10
#3024-003
AMENDMENT TO LOAN DOCUMENTS
---------------------------
AGREEMENT made as of June 30, 2004 ("AMENDMENT AGREEMENT" or
"AGREEMENT") by and between LYON FINANCIAL SERVICES, INC. DBA U.S. BANK
PORTFOLIO SERVICES, as Successor Servicer for DVI Receivables X, L.L.C. and as
Agent for U.S. Bank, N.A., as Trustee, with offices at 0000 Xxxxxx Xxxxxx, Xxxxx
000, Xxxxxxxx, Xxxxxxxxx 00000 ("USBPS") and Radnet Management II, Inc., a
corporation, with offices at 0000 Xxxxxx Xxxxxx, Xxx Xxxxxxx, XX 00000 ("RADNET
II"), and such other signatories hereto.
WHEREAS, on or about May 3, 2001, Radnet II executed and
delivered to DVI Financial Services Inc. ("DVI") a Master Loan Agreement
collectively with the Secured Promissory Note Number #3024-003 dated May 3, 2001
(the "LOAN");
WHEREAS, to secure the payment of the Loan and all other
obligations of Radnet II to DVI (collectively the "OBLIGATIONS"), Radnet II,
pursuant to a Master Security Agreement dated on or about May 3, 2001 (the
"SECURITY AGREEMENT"), granted DVI a first priority security interest in certain
Collateral described therein;
WHEREAS, to further secure payment of the Note and all other
Obligations of Radnet II to DVI, Radnet II delivered to DVI the guarantee (the
"GUARANTEE") of Radnet Management I, Inc. (the "GUARANTOR") (the "GUARANTEE"
together with the Loan and ancillary documents are, collectively the "LOAN
DOCUMENTS");
WHEREAS, substantially contemporaneously therewith, DVI
contributed all of the Loan Documents to DVI Receivables X, L.L.C. ("DVI X") and
thereafter pursuant to an Amended and Restated Indenture, DVI X granted a first
priority security interest in and pledged all of the Loan Documents in favor of
U.S. Bank, N.A., as Trustee, for the benefit of a noteholder which purchased
asset backed promissory notes issued by DVI X (the "Noteholder");
#3024-003
WHEREAS, DVI contributed other Loans with Radnet II or certain
affiliates of Radnet II to this and other DVI securitizations (collectively the
"RELATED LOANS");
WHEREAS, Radnet II is in default under the terms of the Loan;
WHEREAS, Radnet II has requested USBPS to modify the Loan to
reflect an adjustment in payments;
WHEREAS, Radnet II and/or certain of its affiliates have
agreed to modify the Related Loans;
WHEREAS, Radnet II and certain of its affiliates are engaged
in negotiations to restructure or modify certain loan agreements, loans and
promissory notes with each of General Electric Capital Corporation ("GECC") and
DVI (with respect to GECC, the "GECC MODIFICATION", and with respect to DVI, the
"DVI MODIFICATION");
WHEREAS, subject to the following terms and conditions, USBPS
is willing to modify the Loan as hereinafter provided.
NOW, THEREFORE, the parties agree as follows:
1. All of the Whereas clauses are incorporated herein as if
hereinafter set forth at full length.
2. Radnet II acknowledges that it is duly indebted to the
Trustee in the sum set forth on AMENDED AND RESTATED RIDER A annexed hereto, and
has no defenses, counterclaims or offsets to such indebtedness.
3. USBPS as Agent for the Trustee will modify the Loan to
provide for payments to commence in accordance with the attached revised payment
schedule (the "AMENDED AND RESTATED RIDER A"). Radnet II may, at any time,
prepay all of the then
2
#3024-003
outstanding Obligations subject to an additional prepayment fee of 2% of such
Obligations. Partial prepayments of the Obligations shall not be permitted at
any time.
4. This Agreement shall become effective upon the date that
USBPS receives this Agreement duly executed by Radnet II and the satisfaction of
each of the following conditions:
(a) Radnet II and/or its affiliates shall have
entered into agreements on similar terms to this Agreement and
otherwise in form and substance satisfactory to USBPS,
relating to the Related Loans (the "Related Loan
Modifications");
(b) reimbursement of USBPS's legal fees incurred in
connection with the execution of this Agreement and the
Related Loan Modifications, aggregating $50,000, shall have
been received by USBPS;
(c) Radnet II and/or its affiliates shall have
entered into the GECC Modification and the DVI Modification.
5. The closing of the restructuring of the Radnet II Loan is
further subject to delivery to USBPS of all of the following, each in form and
substance satisfactory to USBPS and its counsel:
(a) The executed AMENDED AND RESTATED RIDER A;
(b) An executed copy of this Agreement;
(c) Such other documents, including UCC financing
statements as USBPS reasonably requests.
6. Radnet II hereby acknowledges and agrees that it has no,
and will not assert any, defenses, counterclaims or offsets to the Loan and
AMENDED AND RESTATED RIDER A and acknowledges and agrees that the Trustee holds
a first-priority security interest in the Collateral.
3
7. Any default or other breach of any obligation under the
GECC Modification, the DVI Modification, or any of the Related Loan
Modifications shall constitute a default under the Loan as modified by this
Agreement, and USBPS shall have all remedies thereunder.
8. Radnet II hereby releases the Noteholder, USBPS
individually and as agent for the Trustee and the special purpose entities for
which the Trustee holds collateral, from and against any claims, loss or damage
of any kind or nature arising out of the Loan.
9. So long as any of the Obligations remain outstanding,
Radnet Management, Inc. (the "COMPANY") agrees as follows:
(i) FINANCIAL REPORTING. The Company shall furnish
the following documents or information to USBPS:
(A) Within 30 days after the end of each
Fiscal Quarter (as defined below) (i) (or 90 days in respect of the last month
of the fiscal year), the Company's consolidated, consolidating and on a center
by center basis, financial statements, including the most recent annual report,
balance sheet (not on a center by center basis) and income statement, prepared
in accordance with generally accepted accounting principles, which reports, the
Company warrants, shall fully and fairly represent the true financial condition
of the Company and (ii) updated projections for the Company and for each center;
(B) any other financial information normally
provided by the Company to the public; and
(C) Such other financial data or information
relative to this Amendment Agreement, including, without limitation, listings of
serial numbers or other identification data and confirmations of such
information, as USBPS may time-to-time reasonably request.
(ii) NO AMENDMENTS. Subsequent to the date of this
Amendment Agreement, the Company will not agree or consent to any amendments or
modifications to any agreement between the Company and DVI, GECC or Xxxxx Fargo
Foothill, Inc. ("FOOTHILL") containing terms (including, but not limited to,
increasing interest rates, accelerating the principal amortization or maturity,
new or more stringent defaults, additional collateral, and new remedies
provisions) that would be more onerous to the Company, or adversely impact or
affect GECC with respect to the terms of this Amendment Agreement.
4
#3024-003
(iii) DISTRIBUTIONS. The Company shall not make any
distribution or declare or pay any dividends (in cash or other property, other
than common stock) on, or purchase, acquire, redeem, or retire any of the
Company's stock, of any class, whether now or hereafter outstanding
(collectively, "DISTRIBUTIONS"); PROVIDED, HOWEVER, that so long as no default
shall have occurred and be continuing immediately prior to or after giving
effect to any such payment, (a) the Company may make Distributions to Primedex
Health Systems, Inc., a New York corporation (the "PARENT") (1) in amounts
necessary to pay customary expenses of Parent in the ordinary course of its
business as a public holding company (including salaries and related reasonable
and customary expenses incurred by employees of Parent) in an aggregate amount
not to exceed $750,000 in any fiscal year, (2) in amounts necessary to enable
Parent to pay taxes when due and owing by it in the ordinary course of its
business as a holding company and (3) in amounts necessary to enable Parent to
pay interest on those certain 11.5% Series A Convertible Subordinated Notes due
June 30, 2008, issued by Parent on June 25, 1993, and (b) Parent may make
Distributions in the form of common stock.
(iv) FIXED CHARGE COVERAGE RATIO. Commencing April
30, 2005, the Company shall not permit the Fixed Charge Coverage Ratio, (a) to
be less than 1.0:1 as of the end of each April, July, October and January (each,
a "FISCAL QUARTER") ending prior to January 1, 2007, and (b) to be less than
1.05:1 as of the last day of each Fiscal Quarter ending thereafter. "FIXED
CHARGE COVERAGE RATIO" means for any period, the ratio of (i) EBITDA for such
period MINUS cash capital expenditures made (to the extent not already incurred
in a prior period) or incurred during such period, to (ii) the sum of (a)
interest expense, (b) principal payments required to be paid during such period
in respect of indebtedness, and (c) all federal, state, and local income taxes
accrued, all as determined for the twelve months ending on the determination
date for the Company and its subsidiaries on a consolidated basis without
duplication and in accordance with generally accepted accounting principles
consistently applied. "EBITDA" means, with respect to any fiscal period, the
Company's and its subsidiaries' consolidated net earnings (or loss), minus
extraordinary gains and interest income, plus interest expense, income taxes,
and depreciation and amortization for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(v) LEVERAGE RATIO. The Company shall not permit the
Leverage Ratio, as determined as of the end of each Fiscal Quarter, to be
greater than the amount set forth in the following table for the Fiscal Quarters
ending in the period set forth opposite thereto:
LEVERAGE RATIO PERIOD
-------------- ------
4.50:1.0 04/30/05 - 10/30/05
4.30:1.0 10/31/05 - 10/30/06
4.00:1.0 10/31/06 - 10/30/07
3.80:1.0 10/31/07 - 10/30/08
"LEVERAGE RATIO" means, at any date of determination, the
ratio of (a) Total Debt at such date to (b) EBITDA for the applicable period
ending on such date. "TOTAL DEBT" means,
5
#3024-003
as of any date of determination, without duplication, the sum of (a) the
outstanding aggregate amount of the obligations for borrowed money, (b) the
outstanding principal amount of capital leases, (c) the outstanding principal
amount of purchase money indebtedness, (d) the outstanding principal amount of
funded debt, and (e) the outstanding principal amount of all obligations owing
to GECC, DVI and USBPS; all as determined for the Company and its subsidiaries
on a consolidated basis without duplication and in accordance with generally
accepted accounting principles consistently applied.
(vi) EBITDA MARGIN. The Company shall not permit the
EBITDA Margin to be less than 25% as of the end of any Fiscal Quarter ending on
or after April 30, 2005. "EBITDA MARGIN" means for any period, the ratio of (a)
EBITDA for such period, to (b) net revenues (excluding the professional service
fee component of radiology services) for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(vii) RECEIVABLE DAYS. The Company shall not permit
the Receivable Days to exceed 65 days as of the end of any Fiscal Quarter ending
on or after April 30, 2005. "RECEIVABLE DAYS" means for any period, a number
equal to (a) 365 divided by (b) the result of (i) net revenues for such period
divided by (ii) net receivables for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(viii) NAME CHANGES, ETC. The Company agrees that it
shall not change its name or jurisdiction of organization without giving 30 days
prior written notice to USBPS.
10. To induce USBPS on behalf of the Trustee to enter this
Agreement, the Guarantor hereby affirms and restates its Guarantee as related to
this Loan and AMENDED AND RESTATED RIDER A.
11. Radnet II, the Company and the Guarantor each represent
and warrant that each has been represented by an attorney of its choice and is
fully aware of the terms contained in this Agreement and AMENDED AND RESTATED
RIDER A to which it is a party which was voluntarily entered into without
coercion or duress of any kind.
12. Radnet II represents and warrants to USBPS on behalf of
the Noteholders and Trustee that all necessary actions on the part of Radnet II
to be taken in connection with the execution, delivery and performance of this
Agreement have been taken; the performance by
6
#3024-003
Radnet II of this Agreement and the AMENDED AND RESTATED RIDER A will not
violate any of Radnet II's Articles of Incorporation, Articles of Formation,
Partnership Agreement or other agreement or law by which Radnet II is bound.
13. Any notice, request, direction, consent, approval, waiver
or other communication required or permitted under this Agreement to be sent
must be in writing and will become effective only upon delivery to USBPS at the
address set forth herein as follows:
U.S. Bank Portfolio Services
0000 Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxx, XX 00000
Attn: Xxxx Xxx, Director of Operations
14. Except as provided herein, and in the AMENDED AND RESTATED
RIDER A, all of the other provisions of the Loan Documents not restated will
remain in effect.
15. This Agreement and the documents referenced herein
constitute the entire and final agreement among the parties with respect to the
subject matter hereof and there are no agreements, understandings, warranties or
representations among the parties with respect to these matters except as set
forth herein.
16. This Agreement will inure to the benefit of and bind the
parties and their respective successors and permitted assigns.
17. Neither this Agreement nor any of the provisions hereof
can be changed, waived, discharged or terminated except by an instrument in
writing signed by the parties against whom such enforcement of the change,
waiver, discharge or termination is sought.
18. This Agreement will be interpreted and construed under the
laws of the Commonwealth of Pennsylvania, regardless of the domicile of any
party and will be considered to have been made, executed and performed in
Pennsylvania.
7
#3024-003
19. THE UNDERSIGNED, AND SUBJECT TO THE PROVISIONS CONTAINED
HEREIN, USBPS FOR ITSELF AND AS AGENT FOR THE TRUSTEE, (A) AGREE TO SUBMIT FOR
THEMSELVES, IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT AND ANY
SCHEDULE OR FOR RECOGNITION AND ENFORCEMENT OF ANY JUDGMENT IN RESPECT HEREOF OR
THEREOF, TO THE EXCLUSIVE JURISDICTION OF THE COURTS OF THE COMONWEALTH OF
PENNSYLVANIA, THE COURTS OF THE UNITED STATES OF AMERICA FOR THE EASTERN
DISTRICT OF PENNSYLVANIA, AND APPELLATE COURTS FROM ANY THEREOF, (B) CONSENT
THAT ANY ACTION OR PROCEEDING SHALL BE BROUGHT IN SUCH COURTS, AND WAIVE ANY
OBJECTION THAT EACH MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH ACTION OR
PROCEEDING IN ANY SUCH COURT, (C) AGREE THAT SERVICE OF PROCESS OF ANY SUCH
ACTION OR PROCEEDING MAY BE EFFECTED BY CERTIFIED MAIL (OR ANY SUBSTANTIALLY
SIMILAR FORM OF MAIL), POSTAGE PREPAID, TO THE APPROPRIATE PARTY AT ITS ADDRESS
AS SET FORTH HEREIN, AND SERVICE MADE SHALL BE DEEMED TO BE COMPLETED UPON THE
EARLIER OF ACTUAL RECEIPT OR FIVE (5) DAYS AFTER THE SAME SHALL HAVE BEEN POSTED
AS AFORESAID, AND (D) AGREE THAT NOTHING HEREIN OR IN ANY EXHIBIT OR SCHEDULE
SHALL AFFECT THE RIGHT TO EFFECT SERVICE OF PROCESS IN ANY OTHER MANNER
PERMITTED BY LAW. USBPS AND THE UNDERSIGNED EACH HEREBY UNCONDITIONALLY WAIVES
ITS RIGHT TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING
OUT OF, DIRECTLY OR INDIRECTLY, THIS AGREEMENT, ANY EXHIBIT AND THE TRANSACTIONS
8
#3024-003
CONTEMPLATED HEREBY AND THEREBY, ANY OF THE RELATED DOCUMENTS, ANY DEALINGS
BETWEEN THE PARTIES HERETO RELATING TO THE SUBJECT MATTER HEREOF OR THEREOF,
AND/OR THE RELATIONSHIP THAT IS BEING ESTABLISHED BETWEEN USBPS AS AGENT FOR THE
TRUSTEE AND THE UNDERSIGNED, PROVIDED USBPS MAY IN ITS DISCRETION ENFORCE THE
TERMS OF THE FORUM SELECTION PROVISIONS IN THE LOANS.
20. Radnet II, the Company and the Guarantor hereby release
USBPS, the Trustee, and the Noteholders from and against any claim, loss, or
damage arising out of the negotiation execution, and performance of the Loan or
related matters prior to the date hereof.
21. This Agreement may be executed in two or more counterparts
and each counterpart shall be deemed an original.
9
#3024-003
LYON FINANCIAL SERVICES, INC. DBA U.S.
BANK PORTFOLIO SERVICES, AS SUCCESSOR
SERVICER FOR DVI RECEIVABLES X, L.L.C.
AND AS AGENT FOR U.S. BANK, N.A., AS TRUSTEE
By: ________________________________________
RADNET MANAGEMENT II, INC.
By: ________________________________________
RADNET MANAGEMENT, INC.
By: ________________________________________
ACKNOWLEDGED AND AGREED TO:
Radnet Management I, Inc., Guarantor
By: _________________________________
10
#3024-002
AMENDMENT TO LOAN DOCUMENTS
---------------------------
AGREEMENT made as of June 30, 2004 ("AMENDMENT AGREEMENT" or
"AGREEMENT") by and between LYON FINANCIAL SERVICES, INC. DBA U.S. BANK
PORTFOLIO SERVICES, as Successor Servicer for DVI Receivables XVII, L.L.C. and
as Agent for U.S. Bank, N.A., as Trustee, with offices at 0000 Xxxxxx Xxxxxx,
Xxxxx 000, Xxxxxxxx, Xxxxxxxxx 00000 ("USBPS") and Radnet Management II, Inc., a
corporation, with offices at 0000 Xxxxxx Xxxxxx, Xxx Xxxxxxx, XX 00000 ("RADNET
II"), and such other signatories hereto.
WHEREAS, on or about May 3, 2001, Radnet II executed and
delivered to DVI Financial Services Inc. ("DVI") a Master Loan Agreement
collectively with the Secured Promissory Note Number #3024-002 dated May 3, 2001
(the "LOAN");
WHEREAS, to secure the payment of the Loan and all other
obligations of Radnet II to DVI (collectively the "OBLIGATIONS"), Radnet II,
pursuant to a Master Security Agreement dated on or about May 3, 2001 (the
"SECURITY AGREEMENT"), granted DVI a first priority security interest in certain
Collateral described therein;
WHEREAS, to further secure payment of the Note and all other
Obligations of Radnet II to DVI, Radnet II delivered to DVI the guarantee (the
"GUARANTEE") of Radnet Management I, Inc. (the "GUARANTOR") (the "GUARANTEE"
together with the Loan and ancillary documents are, collectively the "LOAN
DOCUMENTS");
WHEREAS, substantially contemporaneously therewith, DVI
contributed all of the Loan Documents to DVI Receivables XVII, L.L.C. ("DVI
XVII") and thereafter pursuant to an Amended and Restated Indenture, DVI XVII
granted a first priority security interest in and pledged all of the Loan
Documents in favor of U.S. Bank, N.A., as Trustee, for the benefit of a
#3024-002
noteholder which purchased asset backed promissory notes issued by DVI XVII (the
"Noteholder");
WHEREAS, DVI contributed other Loans with Radnet II or certain
affiliates of Radnet II to this and other DVI securitizations (collectively the
"RELATED LOANS");
WHEREAS, Radnet II is in default under the terms of the Loan;
WHEREAS, Radnet II has requested USBPS to modify the Loan to
reflect an adjustment in payments;
WHEREAS, Radnet II and/or certain of its affiliates have
agreed to modify the Related Loans;
WHEREAS, Radnet II and certain of its affiliates are engaged
in negotiations to restructure or modify certain loan agreements, loans and
promissory notes with each of General Electric Capital Corporation ("GECC") and
DVI (with respect to GECC, the "GECC MODIFICATION", and with respect to DVI, the
"DVI MODIFICATION");
WHEREAS, subject to the following terms and conditions, USBPS
is willing to modify the Loan as hereinafter provided.
NOW, THEREFORE, the parties agree as follows:
1. All of the Whereas clauses are incorporated herein as if
hereinafter set forth at full length.
2. Radnet II acknowledges that it is duly indebted to the
Trustee in the sum set forth on AMENDED AND RESTATED RIDER A annexed hereto, and
has no defenses, counterclaims or offsets to such indebtedness.
3. USBPS as Agent for the Trustee will modify the Loan to
provide for payments to commence in accordance with the attached revised payment
schedule (the
2
#3024-002
"AMENDED AND RESTATED RIDER A"). Radnet II may, at any time, prepay all of the
then outstanding Obligations subject to an additional prepayment fee of 2% of
such Obligations. Partial prepayments of the Obligations shall not be permitted
at any time.
4. This Agreement shall become effective upon the date that
USBPS receives this Agreement duly executed by Radnet II and the satisfaction of
each of the following conditions:
(a) Radnet II and/or its affiliates shall have
entered into agreements on similar terms to this Agreement and
otherwise in form and substance satisfactory to USBPS,
relating to the Related Loans (the "Related Loan
Modifications");
(b) reimbursement of USBPS's legal fees incurred in
connection with the execution of this Agreement and the
Related Loan Modifications, aggregating $50,000, shall have
been received by USBPS;
(c) Radnet II and/or its affiliates shall have
entered into the GECC Modification and the DVI Modification.
5. The closing of the restructuring of the Radnet II Loan is
further subject to delivery to USBPS of all of the following, each in form and
substance satisfactory to USBPS and its counsel:
(a) The executed AMENDED AND RESTATED RIDER A;
(b) An executed copy of this Agreement;
(c) Such other documents, including UCC financing
statements as USBPS reasonably requests.
6. Radnet II hereby acknowledges and agrees that it has no,
and will not assert any, defenses, counterclaims or offsets to the Loan and
AMENDED AND RESTATED RIDER A and acknowledges and agrees that the Trustee holds
a first-priority security interest in the Collateral.
3
7. Any default or other breach of any obligation under the
GECC Modification, the DVI Modification, or any of the Related Loan
Modifications shall constitute a default under the Loan as modified by this
Agreement, and USBPS shall have all remedies thereunder.
8. Radnet II hereby releases the Noteholder, USBPS
individually and as agent for the Trustee and the special purpose entities for
which the Trustee holds collateral, from and against any claims, loss or damage
of any kind or nature arising out of the Loan.
9. So long as any of the Obligations remain outstanding,
Radnet Management, Inc. (the "COMPANY") agrees as follows:
(i) FINANCIAL REPORTING. The Company shall furnish
the following documents or information to USBPS:
(A) Within 30 days after the end of each
Fiscal Quarter (as defined below) (i) (or 90 days in respect of the last month
of the fiscal year), the Company's consolidated, consolidating and on a center
by center basis, financial statements, including the most recent annual report,
balance sheet (not on a center by center basis) and income statement, prepared
in accordance with generally accepted accounting principles, which reports, the
Company warrants, shall fully and fairly represent the true financial condition
of the Company and (ii) updated projections for the Company and for each center;
(B) any other financial information normally
provided by the Company to the public; and
(C) Such other financial data or information
relative to this Amendment Agreement, including, without limitation, listings of
serial numbers or other identification data and confirmations of such
information, as USBPS may time-to-time reasonably request.
(ii) NO AMENDMENTS. Subsequent to the date of this
Amendment Agreement, the Company will not agree or consent to any amendments or
modifications to any agreement between the Company and DVI, GECC or Xxxxx Fargo
Foothill, Inc. ("FOOTHILL") containing terms (including, but not limited to,
increasing interest rates, accelerating the principal amortization or maturity,
new or more stringent defaults, additional collateral, and new remedies
provisions) that would be more onerous to the Company, or adversely impact or
affect GECC with respect to the terms of this Amendment Agreement.
4
#3024-002
(iii) DISTRIBUTIONS. The Company shall not make any
distribution or declare or pay any dividends (in cash or other property, other
than common stock) on, or purchase, acquire, redeem, or retire any of the
Company's stock, of any class, whether now or hereafter outstanding
(collectively, "DISTRIBUTIONS"); PROVIDED, HOWEVER, that so long as no default
shall have occurred and be continuing immediately prior to or after giving
effect to any such payment, (a) the Company may make Distributions to Primedex
Health Systems, Inc., a New York corporation (the "PARENT") (1) in amounts
necessary to pay customary expenses of Parent in the ordinary course of its
business as a public holding company (including salaries and related reasonable
and customary expenses incurred by employees of Parent) in an aggregate amount
not to exceed $750,000 in any fiscal year, (2) in amounts necessary to enable
Parent to pay taxes when due and owing by it in the ordinary course of its
business as a holding company and (3) in amounts necessary to enable Parent to
pay interest on those certain 11.5% Series A Convertible Subordinated Notes due
June 30, 2008, issued by Parent on June 25, 1993, and (b) Parent may make
Distributions in the form of common stock.
(iv) FIXED CHARGE COVERAGE RATIO. Commencing April
30, 2005, the Company shall not permit the Fixed Charge Coverage Ratio, (a) to
be less than 1.0:1 as of the end of each April, July, October and January (each,
a "FISCAL QUARTER") ending prior to January 1, 2007, and (b) to be less than
1.05:1 as of the last day of each Fiscal Quarter ending thereafter. "FIXED
CHARGE COVERAGE RATIO" means for any period, the ratio of (i) EBITDA for such
period MINUS cash capital expenditures made (to the extent not already incurred
in a prior period) or incurred during such period, to (ii) the sum of (a)
interest expense, (b) principal payments required to be paid during such period
in respect of indebtedness, and (c) all federal, state, and local income taxes
accrued, all as determined for the twelve months ending on the determination
date for the Company and its subsidiaries on a consolidated basis without
duplication and in accordance with generally accepted accounting principles
consistently applied. "EBITDA" means, with respect to any fiscal period, the
Company's and its subsidiaries' consolidated net earnings (or loss), minus
extraordinary gains and interest income, plus interest expense, income taxes,
and depreciation and amortization for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(v) LEVERAGE RATIO. The Company shall not permit the
Leverage Ratio, as determined as of the end of each Fiscal Quarter, to be
greater than the amount set forth in the following table for the Fiscal Quarters
ending in the period set forth opposite thereto:
LEVERAGE RATIO PERIOD
-------------- ------
4.50:1.0 04/30/05 - 10/30/05
4.30:1.0 10/31/05 - 10/30/06
4.00:1.0 10/31/06 - 10/30/07
3.80:1.0 10/31/07 - 10/30/08
"LEVERAGE RATIO" means, at any date of determination, the
ratio of (a) Total Debt at such date to (b) EBITDA for the applicable period
ending on such date. "TOTAL DEBT" means,
5
#3024-002
as of any date of determination, without duplication, the sum of (a) the
outstanding aggregate amount of the obligations for borrowed money, (b) the
outstanding principal amount of capital leases, (c) the outstanding principal
amount of purchase money indebtedness, (d) the outstanding principal amount of
funded debt, and (e) the outstanding principal amount of all obligations owing
to GECC, DVI and USBPS; all as determined for the Company and its subsidiaries
on a consolidated basis without duplication and in accordance with generally
accepted accounting principles consistently applied.
(vi) EBITDA MARGIN. The Company shall not permit the
EBITDA Margin to be less than 25% as of the end of any Fiscal Quarter ending on
or after April 30, 2005. "EBITDA MARGIN" means for any period, the ratio of (a)
EBITDA for such period, to (b) net revenues (excluding the professional service
fee component of radiology services) for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(vii) RECEIVABLE DAYS. The Company shall not permit
the Receivable Days to exceed 65 days as of the end of any Fiscal Quarter ending
on or after April 30, 2005. "RECEIVABLE DAYS" means for any period, a number
equal to (a) 365 divided by (b) the result of (i) net revenues for such period
divided by (ii) net receivables for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(viii) NAME CHANGES, ETC. The Company agrees that it
shall not change its name or jurisdiction of organization without giving 30 days
prior written notice to USBPS.
10. To induce USBPS on behalf of the Trustee to enter this
Agreement, the Guarantor hereby affirms and restates its Guarantee as related to
this Loan and AMENDED AND RESTATED RIDER A.
11. Radnet II, the Company and the Guarantor each represent
and warrant that each has been represented by an attorney of its choice and is
fully aware of the terms contained in this Agreement and AMENDED AND RESTATED
RIDER A to which it is a party which was voluntarily entered into without
coercion or duress of any kind.
12. Radnet II represents and warrants to USBPS on behalf of
the Noteholders and Trustee that all necessary actions on the part of Radnet II
to be taken in connection with the execution, delivery and performance of this
Agreement have been taken; the performance by
6
#3024-002
Radnet II of this Agreement and the AMENDED AND RESTATED RIDER A will not
violate any of Radnet II's Articles of Incorporation, Articles of Formation,
Partnership Agreement or other agreement or law by which Radnet II is bound.
13. Any notice, request, direction, consent, approval, waiver
or other communication required or permitted under this Agreement to be sent
must be in writing and will become effective only upon delivery to USBPS at the
address set forth herein as follows:
U.S. Bank Portfolio Services
0000 Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxx, XX 00000
Attn: Xxxx Xxx, Director of Operations
14. Except as provided herein, and in the AMENDED AND RESTATED
RIDER A, all of the other provisions of the Loan Documents not restated will
remain in effect.
15. This Agreement and the documents referenced herein
constitute the entire and final agreement among the parties with respect to the
subject matter hereof and there are no agreements, understandings, warranties or
representations among the parties with respect to these matters except as set
forth herein.
16. This Agreement will inure to the benefit of and bind the
parties and their respective successors and permitted assigns.
17. Neither this Agreement nor any of the provisions hereof
can be changed, waived, discharged or terminated except by an instrument in
writing signed by the parties against whom such enforcement of the change,
waiver, discharge or termination is sought.
18. This Agreement will be interpreted and construed under the
laws of the Commonwealth of Pennsylvania, regardless of the domicile of any
party and will be considered to have been made, executed and performed in
Pennsylvania.
7
#3024-002
19. THE UNDERSIGNED, AND SUBJECT TO THE PROVISIONS CONTAINED
HEREIN, USBPS FOR ITSELF AND AS AGENT FOR THE TRUSTEE, (A) AGREE TO SUBMIT FOR
THEMSELVES, IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT AND ANY
SCHEDULE OR FOR RECOGNITION AND ENFORCEMENT OF ANY JUDGMENT IN RESPECT HEREOF OR
THEREOF, TO THE EXCLUSIVE JURISDICTION OF THE COURTS OF THE COMONWEALTH OF
PENNSYLVANIA, THE COURTS OF THE UNITED STATES OF AMERICA FOR THE EASTERN
DISTRICT OF PENNSYLVANIA, AND APPELLATE COURTS FROM ANY THEREOF, (B) CONSENT
THAT ANY ACTION OR PROCEEDING SHALL BE BROUGHT IN SUCH COURTS, AND WAIVE ANY
OBJECTION THAT EACH MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH ACTION OR
PROCEEDING IN ANY SUCH COURT, (C) AGREE THAT SERVICE OF PROCESS OF ANY SUCH
ACTION OR PROCEEDING MAY BE EFFECTED BY CERTIFIED MAIL (OR ANY SUBSTANTIALLY
SIMILAR FORM OF MAIL), POSTAGE PREPAID, TO THE APPROPRIATE PARTY AT ITS ADDRESS
AS SET FORTH HEREIN, AND SERVICE MADE SHALL BE DEEMED TO BE COMPLETED UPON THE
EARLIER OF ACTUAL RECEIPT OR FIVE (5) DAYS AFTER THE SAME SHALL HAVE BEEN POSTED
AS AFORESAID, AND (D) AGREE THAT NOTHING HEREIN OR IN ANY EXHIBIT OR SCHEDULE
SHALL AFFECT THE RIGHT TO EFFECT SERVICE OF PROCESS IN ANY OTHER MANNER
PERMITTED BY LAW. USBPS AND THE UNDERSIGNED EACH HEREBY UNCONDITIONALLY WAIVES
ITS RIGHT TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING
OUT OF, DIRECTLY OR INDIRECTLY, THIS AGREEMENT, ANY EXHIBIT AND THE TRANSACTIONS
8
#3024-002
CONTEMPLATED HEREBY AND THEREBY, ANY OF THE RELATED DOCUMENTS, ANY DEALINGS
BETWEEN THE PARTIES HERETO RELATING TO THE SUBJECT MATTER HEREOF OR THEREOF,
AND/OR THE RELATIONSHIP THAT IS BEING ESTABLISHED BETWEEN USBPS AS AGENT FOR THE
TRUSTEE AND THE UNDERSIGNED, PROVIDED USBPS MAY IN ITS DISCRETION ENFORCE THE
TERMS OF THE FORUM SELECTION PROVISIONS IN THE LOANS.
20. Radnet II, the Company and the Guarantor hereby release
USBPS, the Trustee, and the Noteholders from and against any claim, loss, or
damage arising out of the negotiation execution, and performance of the Loan or
related matters prior to the date hereof.
21. This Agreement may be executed in two or more counterparts
and each counterpart shall be deemed an original.
9
#3024-002
LYON FINANCIAL SERVICES, INC. DBA U.S.
BANK PORTFOLIO SERVICES, AS SUCCESSOR
SERVICER FOR DVI RECEIVABLES XVII, L.L.C.
AND AS AGENT FOR U.S. BANK, N.A., AS TRUSTEE
By: ________________________________________
RADNET MANAGEMENT II, INC.
By: ________________________________________
RADNET MANAGEMENT, INC.
By: ________________________________________
ACKNOWLEDGED AND AGREED TO:
Radnet Management I, Inc., Guarantor
By: ________________________________
10
#3024-001
AMENDMENT TO LOAN DOCUMENTS
---------------------------
AGREEMENT made as of June 30, 2004 ("AMENDMENT AGREEMENT" or
"AGREEMENT") by and between LYON FINANCIAL SERVICES, INC. DBA U.S. BANK
PORTFOLIO SERVICES, as Successor Servicer for DVI Receivables XVII, L.L.C. and
as Agent for U.S. Bank, N.A., as Trustee, with offices at 0000 Xxxxxx Xxxxxx,
Xxxxx 000, Xxxxxxxx, Xxxxxxxxx 00000 ("USBPS") and Radnet Management II, Inc., a
corporation, with offices at 0000 Xxxxxx Xxxxxx, Xxx Xxxxxxx, XX 00000 ("RADNET
II"), and such other signatories hereto.
WHEREAS, on or about May 3, 2001, Radnet II executed and
delivered to DVI Financial Services Inc. ("DVI") a Master Loan Agreement
collectively with the Secured Promissory Note Number #3024-001 dated May 3, 2001
(the "LOAN");
WHEREAS, to secure the payment of the Loan and all other
obligations of Radnet II to DVI (collectively the "OBLIGATIONS"), Radnet II,
pursuant to a Master Security Agreement dated on or about May 3, 2001 (the
"SECURITY AGREEMENT"), granted DVI a first priority security interest in certain
Collateral described therein;
WHEREAS, to further secure payment of the Note and all other
Obligations of Radnet II to DVI, Radnet II delivered to DVI the guarantee (the
"GUARANTEE") of Radnet Management I, Inc. (the "GUARANTOR") (the "GUARANTEE"
together with the Loan and ancillary documents are, collectively the "LOAN
DOCUMENTS");
WHEREAS, substantially contemporaneously therewith, DVI
contributed all of the Loan Documents to DVI Receivables XVII, L.L.C. ("DVI
XVII") and thereafter pursuant to an Amended and Restated Indenture, DVI XVII
granted a first priority security interest in and pledged all of the Loan
Documents in favor of U.S. Bank, N.A., as Trustee, for the benefit of a
#3024-001
noteholder which purchased asset backed promissory notes issued by DVI XVII (the
"Noteholder");
WHEREAS, DVI contributed other Loans with Radnet II or certain
affiliates of Radnet II to this and other DVI securitizations (collectively the
"RELATED LOANS");
WHEREAS, Radnet II is in default under the terms of the Loan;
WHEREAS, Radnet II has requested USBPS to modify the Loan to
reflect an adjustment in payments;
WHEREAS, Radnet II and/or certain of its affiliates have
agreed to modify the Related Loans;
WHEREAS, Radnet II and certain of its affiliates are engaged
in negotiations to restructure or modify certain loan agreements, loans and
promissory notes with each of General Electric Capital Corporation ("GECC") and
DVI (with respect to GECC, the "GECC MODIFICATION", and with respect to DVI, the
"DVI MODIFICATION");
WHEREAS, subject to the following terms and conditions, USBPS
is willing to modify the Loan as hereinafter provided.
NOW, THEREFORE, the parties agree as follows:
1. All of the Whereas clauses are incorporated herein as if
hereinafter set forth at full length.
2. Radnet II acknowledges that it is duly indebted to the
Trustee in the sum set forth on AMENDED AND RESTATED RIDER A annexed hereto, and
has no defenses, counterclaims or offsets to such indebtedness.
3. USBPS as Agent for the Trustee will modify the Loan to
provide for payments to commence in accordance with the attached revised payment
schedule (the
2
#3024-001
"AMENDED AND RESTATED RIDER A"). Radnet II may, at any time, prepay all of the
then outstanding Obligations subject to an additional prepayment fee of 2% of
such Obligations. Partial prepayments of the Obligations shall not be permitted
at any time.
4. This Agreement shall become effective upon the date that
USBPS receives this Agreement duly executed by Radnet II and the satisfaction of
each of the following conditions:
(a) Radnet II and/or its affiliates shall have
entered into agreements on similar terms to this Agreement and
otherwise in form and substance satisfactory to USBPS,
relating to the Related Loans (the "Related Loan
Modifications");
(b) reimbursement of USBPS's legal fees incurred in
connection with the execution of this Agreement and the
Related Loan Modifications, aggregating $50,000, shall have
been received by USBPS;
(c) Radnet II and/or its affiliates shall have
entered into the GECC Modification and the DVI Modification.
5. The closing of the restructuring of the Radnet II Loan is
further subject to delivery to USBPS of all of the following, each in form and
substance satisfactory to USBPS and its counsel:
(a) The executed AMENDED AND RESTATED RIDER A;
(b) An executed copy of this Agreement;
(c) Such other documents, including UCC financing
statements as USBPS reasonably requests.
6. Radnet II hereby acknowledges and agrees that it has no,
and will not assert any, defenses, counterclaims or offsets to the Loan and
AMENDED AND RESTATED RIDER A and acknowledges and agrees that the Trustee holds
a first-priority security interest in the Collateral.
3
7. Any default or other breach of any obligation under the
GECC Modification, the DVI Modification, or any of the Related Loan
Modifications shall constitute a default under the Loan as modified by this
Agreement, and USBPS shall have all remedies thereunder.
8. Radnet II hereby releases the Noteholder, USBPS
individually and as agent for the Trustee and the special purpose entities for
which the Trustee holds collateral, from and against any claims, loss or damage
of any kind or nature arising out of the Loan.
9. So long as any of the Obligations remain outstanding,
Radnet Management, Inc. (the "COMPANY") agrees as follows:
(i) FINANCIAL REPORTING. The Company shall furnish
the following documents or information to USBPS:
(A) Within 30 days after the end of each
Fiscal Quarter (as defined below) (i) (or 90 days in respect of the last month
of the fiscal year), the Company's consolidated, consolidating and on a center
by center basis, financial statements, including the most recent annual report,
balance sheet (not on a center by center basis) and income statement, prepared
in accordance with generally accepted accounting principles, which reports, the
Company warrants, shall fully and fairly represent the true financial condition
of the Company and (ii) updated projections for the Company and for each center;
(B) any other financial information normally
provided by the Company to the public; and
(C) Such other financial data or information
relative to this Amendment Agreement, including, without limitation, listings of
serial numbers or other identification data and confirmations of such
information, as USBPS may time-to-time reasonably request.
(ii) NO AMENDMENTS. Subsequent to the date of this
Amendment Agreement, the Company will not agree or consent to any amendments or
modifications to any agreement between the Company and DVI, GECC or Xxxxx Fargo
Foothill, Inc. ("FOOTHILL") containing terms (including, but not limited to,
increasing interest rates, accelerating the principal amortization or maturity,
new or more stringent defaults, additional collateral, and new remedies
provisions) that would be more onerous to the Company, or adversely impact or
affect GECC with respect to the terms of this Amendment Agreement.
4
#3024-001
(iii) DISTRIBUTIONS. The Company shall not make any
distribution or declare or pay any dividends (in cash or other property, other
than common stock) on, or purchase, acquire, redeem, or retire any of the
Company's stock, of any class, whether now or hereafter outstanding
(collectively, "DISTRIBUTIONS"); PROVIDED, HOWEVER, that so long as no default
shall have occurred and be continuing immediately prior to or after giving
effect to any such payment, (a) the Company may make Distributions to Primedex
Health Systems, Inc., a New York corporation (the "PARENT") (1) in amounts
necessary to pay customary expenses of Parent in the ordinary course of its
business as a public holding company (including salaries and related reasonable
and customary expenses incurred by employees of Parent) in an aggregate amount
not to exceed $750,000 in any fiscal year, (2) in amounts necessary to enable
Parent to pay taxes when due and owing by it in the ordinary course of its
business as a holding company and (3) in amounts necessary to enable Parent to
pay interest on those certain 11.5% Series A Convertible Subordinated Notes due
June 30, 2008, issued by Parent on June 25, 1993, and (b) Parent may make
Distributions in the form of common stock.
(iv) FIXED CHARGE COVERAGE RATIO. Commencing April
30, 2005, the Company shall not permit the Fixed Charge Coverage Ratio, (a) to
be less than 1.0:1 as of the end of each April, July, October and January (each,
a "FISCAL QUARTER") ending prior to January 1, 2007, and (b) to be less than
1.05:1 as of the last day of each Fiscal Quarter ending thereafter. "FIXED
CHARGE COVERAGE RATIO" means for any period, the ratio of (i) EBITDA for such
period minus cash capital expenditures made (to the extent not already incurred
in a prior period) or incurred during such period, to (ii) the sum of (a)
interest expense, (b) principal payments required to be paid during such period
in respect of indebtedness, and (c) all federal, state, and local income taxes
accrued, all as determined for the twelve months ending on the determination
date for the Company and its subsidiaries on a consolidated basis without
duplication and in accordance with generally accepted accounting principles
consistently applied. "EBITDA" means, with respect to any fiscal period, the
Company's and its subsidiaries' consolidated net earnings (or loss), minus
extraordinary gains and interest income, plus interest expense, income taxes,
and depreciation and amortization for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(v) LEVERAGE RATIO. The Company shall not permit the
Leverage Ratio, as determined as of the end of each Fiscal Quarter, to be
greater than the amount set forth in the following table for the Fiscal Quarters
ending in the period set forth opposite thereto:
LEVERAGE RATIO PERIOD
-------------- ------
4.50:1.0 04/30/05 - 10/30/05
4.30:1.0 10/31/05 - 10/30/06
4.00:1.0 10/31/06 - 10/30/07
3.80:1.0 10/31/07 - 10/30/08
"LEVERAGE RATIO" means, at any date of determination, the
ratio of (a) Total Debt at such date to (b) EBITDA for the applicable period
ending on such date. "TOTAL DEBT" means,
5
#3024-001
as of any date of determination, without duplication, the sum of (a) the
outstanding aggregate amount of the obligations for borrowed money, (b) the
outstanding principal amount of capital leases, (c) the outstanding principal
amount of purchase money indebtedness, (d) the outstanding principal amount of
funded debt, and (e) the outstanding principal amount of all obligations owing
to GECC, DVI and USBPS; all as determined for the Company and its subsidiaries
on a consolidated basis without duplication and in accordance with generally
accepted accounting principles consistently applied.
(vi) EBITDA MARGIN. The Company shall not permit the
EBITDA Margin to be less than 25% as of the end of any Fiscal Quarter ending on
or after April 30, 2005. "EBITDA MARGIN" means for any period, the ratio of (a)
EBITDA for such period, to (b) net revenues (excluding the professional service
fee component of radiology services) for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(vii) RECEIVABLE DAYS. The Company shall not permit
the Receivable Days to exceed 65 days as of the end of any Fiscal Quarter ending
on or after April 30, 2005. "RECEIVABLE DAYS" means for any period, a number
equal to (a) 365 divided by (b) the result of (i) net revenues for such period
divided by (ii) net receivables for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(viii) NAME CHANGES, ETC. The Company agrees that it
shall not change its name or jurisdiction of organization without giving 30 days
prior written notice to USBPS.
10. To induce USBPS on behalf of the Trustee to enter this
Agreement, the Guarantor hereby affirms and restates its Guarantee as related to
this Loan and AMENDED AND RESTATED RIDER A.
11. Radnet II, the Company and the Guarantor each represent
and warrant that each has been represented by an attorney of its choice and is
fully aware of the terms contained in this Agreement and AMENDED AND RESTATED
RIDER A to which it is a party which was voluntarily entered into without
coercion or duress of any kind.
12. Radnet II represents and warrants to USBPS on behalf of
the Noteholders and Trustee that all necessary actions on the part of Radnet II
to be taken in connection with the execution, delivery and performance of this
Agreement have been taken; the performance by
6
#3024-001
Radnet II of this Agreement and the AMENDED AND RESTATED RIDER A will not
violate any of Radnet II's Articles of Incorporation, Articles of Formation,
Partnership Agreement or other agreement or law by which Radnet II is bound.
13. Any notice, request, direction, consent, approval, waiver
or other communication required or permitted under this Agreement to be sent
must be in writing and will become effective only upon delivery to USBPS at the
address set forth herein as follows:
U.S. Bank Portfolio Services
0000 Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxx, XX 00000
Attn: Xxxx Xxx, Director of Operations
14. Except as provided herein, and in the AMENDED AND RESTATED
RIDER A, all of the other provisions of the Loan Documents not restated will
remain in effect.
15. This Agreement and the documents referenced herein
constitute the entire and final agreement among the parties with respect to the
subject matter hereof and there are no agreements, understandings, warranties or
representations among the parties with respect to these matters except as set
forth herein.
16. This Agreement will inure to the benefit of and bind the
parties and their respective successors and permitted assigns.
17. Neither this Agreement nor any of the provisions hereof
can be changed, waived, discharged or terminated except by an instrument in
writing signed by the parties against whom such enforcement of the change,
waiver, discharge or termination is sought.
18. This Agreement will be interpreted and construed under the
laws of the Commonwealth of Pennsylvania, regardless of the domicile of any
party and will be considered to have been made, executed and performed in
Pennsylvania.
7
#3024-001
19. THE UNDERSIGNED, AND SUBJECT TO THE PROVISIONS CONTAINED
HEREIN, USBPS FOR ITSELF AND AS AGENT FOR THE TRUSTEE, (A) AGREE TO SUBMIT FOR
THEMSELVES, IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT AND ANY
SCHEDULE OR FOR RECOGNITION AND ENFORCEMENT OF ANY JUDGMENT IN RESPECT HEREOF OR
THEREOF, TO THE EXCLUSIVE JURISDICTION OF THE COURTS OF THE COMONWEALTH OF
PENNSYLVANIA, THE COURTS OF THE UNITED STATES OF AMERICA FOR THE EASTERN
DISTRICT OF PENNSYLVANIA, AND APPELLATE COURTS FROM ANY THEREOF, (B) CONSENT
THAT ANY ACTION OR PROCEEDING SHALL BE BROUGHT IN SUCH COURTS, AND WAIVE ANY
OBJECTION THAT EACH MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH ACTION OR
PROCEEDING IN ANY SUCH COURT, (C) AGREE THAT SERVICE OF PROCESS OF ANY SUCH
ACTION OR PROCEEDING MAY BE EFFECTED BY CERTIFIED MAIL (OR ANY SUBSTANTIALLY
SIMILAR FORM OF MAIL), POSTAGE PREPAID, TO THE APPROPRIATE PARTY AT ITS ADDRESS
AS SET FORTH HEREIN, AND SERVICE MADE SHALL BE DEEMED TO BE COMPLETED UPON THE
EARLIER OF ACTUAL RECEIPT OR FIVE (5) DAYS AFTER THE SAME SHALL HAVE BEEN POSTED
AS AFORESAID, AND (D) AGREE THAT NOTHING HEREIN OR IN ANY EXHIBIT OR SCHEDULE
SHALL AFFECT THE RIGHT TO EFFECT SERVICE OF PROCESS IN ANY OTHER MANNER
PERMITTED BY LAW. USBPS AND THE UNDERSIGNED EACH HEREBY UNCONDITIONALLY WAIVES
ITS RIGHT TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING
OUT OF, DIRECTLY OR INDIRECTLY, THIS AGREEMENT, ANY EXHIBIT AND THE TRANSACTIONS
8
#3024-001
CONTEMPLATED HEREBY AND THEREBY, ANY OF THE RELATED DOCUMENTS, ANY DEALINGS
BETWEEN THE PARTIES HERETO RELATING TO THE SUBJECT MATTER HEREOF OR THEREOF,
AND/OR THE RELATIONSHIP THAT IS BEING ESTABLISHED BETWEEN USBPS AS AGENT FOR THE
TRUSTEE AND THE UNDERSIGNED, PROVIDED USBPS MAY IN ITS DISCRETION ENFORCE THE
TERMS OF THE FORUM SELECTION PROVISIONS IN THE LOANS.
20. Radnet II, the Company and the Guarantor hereby release
USBPS, the Trustee, and the Noteholders from and against any claim, loss, or
damage arising out of the negotiation execution, and performance of the Loan or
related matters prior to the date hereof.
21. This Agreement may be executed in two or more counterparts
and each counterpart shall be deemed an original.
9
#3024-001
LYON FINANCIAL SERVICES, INC. DBA U.S.
BANK PORTFOLIO SERVICES, AS SUCCESSOR
SERVICER FOR DVI RECEIVABLES XVII, L.L.C.
AND AS AGENT FOR U.S. BANK, N.A., AS TRUSTEE
By: ________________________________________
RADNET MANAGEMENT II, INC.
By: ________________________________________
RADNET MANAGEMENT, INC.
By: ________________________________________
ACKNOWLEDGED AND AGREED TO:
Radnet Management I, Inc., Guarantor
By: _________________________________
10
#2661-004
AMENDMENT TO LOAN DOCUMENTS
---------------------------
AGREEMENT made as of June 30, 2004 ("AMENDMENT AGREEMENT" or
"AGREEMENT") by and between LYON FINANCIAL SERVICES, INC. DBA U.S. BANK
PORTFOLIO SERVICES, as Successor Servicer for DVI Receivables XII, L.L.C. and as
Agent for U.S. Bank, N.A., as Trustee, with offices at 0000 Xxxxxx Xxxxxx, Xxxxx
000, Xxxxxxxx, Xxxxxxxxx 00000 ("USBPS") and SoCal MR Site Management, Inc., a
corporation, with offices at 0000 Xxxxxx Xxxxxx, Xxx Xxxxxxx, XX 00000
("SOCAL"), and such other signatories hereto.
WHEREAS, on or about June 5, 2000, SoCal executed and
delivered to DVI Financial Services Inc. ("DVI") a Term Loan Agreement
collectively with the Secured Promissory Note Number #2661-004 dated June 5,
2000 (the "LOAN");
WHEREAS, to secure the payment of the Loan and all other
obligations of SoCal to DVI (collectively the "OBLIGATIONS"), SoCal, pursuant to
a Security Agreement dated on or about June 5, 2000 (the "SECURITY AGREEMENT"),
granted DVI a first priority security interest in certain Collateral described
therein;
WHEREAS, to further secure payment of the Note and all other
Obligations of SoCal to DVI, SoCal delivered to DVI the guarantee (the
"GUARANTEE") of Radnet Management, Inc. (the "GUARANTOR") (the "GUARANTEE"
together with the Loan and ancillary documents are, collectively the "LOAN
DOCUMENTS");
WHEREAS, substantially contemporaneously therewith, DVI
contributed all of the Loan Documents to DVI Receivables XII, L.L.C. ("DVI XII")
and thereafter pursuant to an Amended and Restated Indenture, DVI XII granted a
first priority security interest in and pledged all of the Loan Documents in
favor of U.S. Bank, N.A., as Trustee, for the benefit of a
#2661-004
noteholder which purchased asset backed promissory notes issued by DVI XII (the
"Noteholder");
WHEREAS, DVI contributed other Loans with SoCal or certain
affiliates of SoCal to this and other DVI securitizations (collectively the
"RELATED LOANS");
WHEREAS, SoCal is in default under the terms of the Loan;
WHEREAS, SoCal has requested USBPS to modify the Loan to
reflect an adjustment in payments;
WHEREAS, SoCal and/or certain of its affiliates have agreed to
modify the Related Loans;
WHEREAS, SoCal and certain of its affiliates are engaged in
negotiations to restructure or modify certain loan agreements, loans and
promissory notes with each of General Electric Capital Corporation ("GECC") and
DVI (with respect to GECC, the "GECC MODIFICATION", and with respect to DVI, the
"DVI MODIFICATION");
WHEREAS, subject to the following terms and conditions, USBPS
is willing to modify the Loan as hereinafter provided.
NOW, THEREFORE, the parties agree as follows:
1. All of the Whereas clauses are incorporated herein as if
hereinafter set forth at full length.
2. SoCal acknowledges that it is duly indebted to the Trustee
in the sum set forth on AMENDED AND RESTATED RIDER A annexed hereto, and has no
defenses, counterclaims or offsets to such indebtedness.
3. USBPS as Agent for the Trustee will modify the Loan to
provide for payments to commence in accordance with the attached revised payment
schedule (the
2
#2661-004
"AMENDED AND RESTATED RIDER A"). SoCal may, at any time, prepay all of the then
outstanding Obligations subject to an additional prepayment fee of 2% of such
Obligations. Partial prepayments of the Obligations shall not be permitted at
any time.
4. This Agreement shall become effective upon the date that
USBPS receives this Agreement
duly executed by SoCal and the satisfaction of each of the following conditions:
(a) SoCal and/or its affiliates shall have entered
into agreements on similar terms to this Agreement and
otherwise in form and substance satisfactory to USBPS,
relating to the Related Loans (the "Related Loan
Modifications");
(b) reimbursement of USBPS's legal fees incurred in
connection with the execution of this Agreement and the
Related Loan Modifications, aggregating $50,000, shall have
been received by USBPS;
(c) SoCal and/or its affiliates shall have entered
into the GECC Modification and the DVI Modification.
5. The closing of the restructuring of the SoCal Loan is
further subject to delivery to USBPS of all of the following, each in form and
substance satisfactory to USBPS and its counsel:
(a) The executed AMENDED AND RESTATED RIDER A;
(b) An executed copy of this Agreement;
(c) Such other documents, including UCC financing
statements as USBPS reasonably requests.
6. SoCal hereby acknowledges and agrees that it has no, and
will not assert any, defenses, counterclaims or offsets to the Loan and AMENDED
AND RESTATED RIDER A and acknowledges and agrees that the Trustee holds a
first-priority security interest in the Collateral.
7. Any default or other breach of any obligation under the
GECC Modification, the DVI Modification, or any of the Related Loan
Modifications shall constitute a
3
#2661-004
default under the Loan as modified by this Agreement, and USBPS shall have all
remedies thereunder.
8. SoCal hereby releases the Noteholder, USBPS individually
and as agent for the Trustee and the special purpose entities for which the
Trustee holds collateral, from and against any claims, loss or damage of any
kind or nature arising out of the Loan.
9. So long as any of the Obligations remain outstanding,
Radnet Management, Inc. (the "COMPANY") agrees as follows:
(i) FINANCIAL REPORTING. The Company shall furnish
the following documents or information to USBPS:
(A) Within 30 days after the end of each
Fiscal Quarter (as defined below) (i) (or 90 days in respect of the last month
of the fiscal year), the Company's consolidated, consolidating and on a center
by center basis, financial statements, including the most recent annual report,
balance sheet (not on a center by center basis) and income statement, prepared
in accordance with generally accepted accounting principles, which reports, the
Company warrants, shall fully and fairly represent the true financial condition
of the Company and (ii) updated projections for the Company and for each center;
(B) any other financial information normally
provided by the Company to the public; and
(C) Such other financial data or information
relative to this Amendment Agreement, including, without limitation, listings of
serial numbers or other identification data and confirmations of such
information, as USBPS may time-to-time reasonably request.
(ii) NO AMENDMENTS. Subsequent to the date of this
Amendment Agreement, the Company will not agree or consent to any amendments or
modifications to any agreement between the Company and DVI, GECC or Xxxxx Fargo
Foothill, Inc. ("FOOTHILL") containing terms (including, but not limited to,
increasing interest rates, accelerating the principal amortization or maturity,
new or more stringent defaults, additional collateral, and new remedies
provisions) that would be more onerous to the Company, or adversely impact or
affect GECC with respect to the terms of this Amendment Agreement.
(iii) DISTRIBUTIONS. The Company shall not make any
distribution or declare or pay any dividends (in cash or other property, other
than common stock) on, or purchase, acquire, redeem, or retire any of the
Company's stock, of any class, whether now or hereafter outstanding
(collectively, "DISTRIBUTIONS"); PROVIDED, HOWEVER, that so long as no
4
#2661-004
default shall have occurred and be continuing immediately prior to or after
giving effect to any such payment, (a) the Company may make Distributions to
Primedex Health Systems, Inc., a New York corporation (the "PARENT") (1) in
amounts necessary to pay customary expenses of Parent in the ordinary course of
its business as a public holding company (including salaries and related
reasonable and customary expenses incurred by employees of Parent) in an
aggregate amount not to exceed $750,000 in any fiscal year, (2) in amounts
necessary to enable Parent to pay taxes when due and owing by it in the ordinary
course of its business as a holding company and (3) in amounts necessary to
enable Parent to pay interest on those certain 11.5% Series A Convertible
Subordinated Notes due June 30, 2008, issued by Parent on June 25, 1993, and (b)
Parent may make Distributions in the form of common stock.
(iv) FIXED CHARGE COVERAGE RATIO. Commencing April
30, 2005, the Company shall not permit the Fixed Charge Coverage Ratio, (a) to
be less than 1.0:1 as of the end of each April, July, October and January (each,
a "FISCAL QUARTER") ending prior to January 1, 2007, and (b) to be less than
1.05:1 as of the last day of each Fiscal Quarter ending thereafter. "FIXED
CHARGE COVERAGE RATIO" means for any period, the ratio of (i) EBITDA for such
period MINUS cash capital expenditures made (to the extent not already incurred
in a prior period) or incurred during such period, to (ii) the sum of (a)
interest expense, (b) principal payments required to be paid during such period
in respect of indebtedness, and (c) all federal, state, and local income taxes
accrued, all as determined for the twelve months ending on the determination
date for the Company and its subsidiaries on a consolidated basis without
duplication and in accordance with generally accepted accounting principles
consistently applied. "EBITDA" means, with respect to any fiscal period, the
Company's and its subsidiaries' consolidated net earnings (or loss), minus
extraordinary gains and interest income, plus interest expense, income taxes,
and depreciation and amortization for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(v) LEVERAGE RATIO. The Company shall not permit the
Leverage Ratio, as determined as of the end of each Fiscal Quarter, to be
greater than the amount set forth in the following table for the Fiscal Quarters
ending in the period set forth opposite thereto:
LEVERAGE RATIO PERIOD
-------------- ------
4.50:1.0 04/30/05 - 10/30/05
4.30:1.0 10/31/05 - 10/30/06
4.00:1.0 10/31/06 - 10/30/07
3.80:1.0 10/31/07 - 10/30/08
"LEVERAGE RATIO" means, at any date of determination, the
ratio of (a) Total Debt at such date to (b) EBITDA for the applicable period
ending on such date. "TOTAL DEBT" means, as of any date of determination,
without duplication, the sum of (a) the outstanding aggregate amount of the
obligations for borrowed money, (b) the outstanding principal amount of capital
leases, (c) the outstanding principal amount of purchase money indebtedness, (d)
the outstanding principal amount of funded debt, and (e) the outstanding
principal amount of all obligations
5
#2661-004
owing to GECC, DVI and USBPS; all as determined for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(vi) EBITDA MARGIN. The Company shall not permit the
EBITDA Margin to be less than 25% as of the end of any Fiscal Quarter ending on
or after April 30, 2005. "EBITDA MARGIN" means for any period, the ratio of (a)
EBITDA for such period, to (b) net revenues (excluding the professional service
fee component of radiology services) for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(vii) RECEIVABLE DAYS. The Company shall not permit
the Receivable Days to exceed 65 days as of the end of any Fiscal Quarter ending
on or after April 30, 2005. "RECEIVABLE DAYS" means for any period, a number
equal to (a) 365 divided by (b) the result of (i) net revenues for such period
divided by (ii) net receivables for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(viii) NAME CHANGES, ETC. The Company agrees that it
shall not change its name or jurisdiction of organization without giving 30 days
prior written notice to USBPS.
10. To induce USBPS on behalf of the Trustee to enter this
Agreement, the Guarantor hereby affirms and restates its Guarantee as related to
this Loan and AMENDED AND RESTATED RIDER A.
11. SoCal, the Company and the Guarantor each represent and
warrant that each has been represented by an attorney of its choice and is fully
aware of the terms contained in this Agreement and AMENDED AND RESTATED RIDER A
to which it is a party which was voluntarily entered into without coercion or
duress of any kind.
12. SoCal represents and warrants to USBPS on behalf of the
Noteholders and Trustee that all necessary actions on the part of SoCal to be
taken in connection with the execution, delivery and performance of this
Agreement have been taken; the performance by SoCal of this Agreement and the
AMENDED AND RESTATED RIDER A will not violate any of SoCal's
6
#2661-004
Articles of Incorporation, Articles of Formation, Partnership Agreement or other
agreement or law by which SoCal is bound.
13. Any notice, request, direction, consent, approval, waiver
or other communication required or permitted under this Agreement to be sent
must be in writing and will become effective only upon delivery to USBPS at the
address set forth herein as follows:
U.S. Bank Portfolio Services
0000 Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxx, XX 00000
Attn: Xxxx Xxx, Director of Operations
14. Except as provided herein, and in the AMENDED AND RESTATED
RIDER A, all of the other provisions of the Loan Documents not restated will
remain in effect.
15. This Agreement and the documents referenced herein
constitute the entire and final agreement among the parties with respect to the
subject matter hereof and there are no agreements, understandings, warranties or
representations among the parties with respect to these matters except as set
forth herein.
16. This Agreement will inure to the benefit of and bind the
parties and their respective successors and permitted assigns.
17. Neither this Agreement nor any of the provisions hereof
can be changed, waived, discharged or terminated except by an instrument in
writing signed by the parties against whom such enforcement of the change,
waiver, discharge or termination is sought.
18. This Agreement will be interpreted and construed under the
laws of the Commonwealth of Pennsylvania, regardless of the domicile of any
party and will be considered to have been made, executed and performed in
Pennsylvania.
7
#2661-004
19. THE UNDERSIGNED, AND SUBJECT TO THE PROVISIONS CONTAINED
HEREIN, USBPS FOR ITSELF AND AS AGENT FOR THE TRUSTEE, (A) AGREE TO SUBMIT FOR
THEMSELVES, IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT AND ANY
SCHEDULE OR FOR RECOGNITION AND ENFORCEMENT OF ANY JUDGMENT IN RESPECT HEREOF OR
THEREOF, TO THE EXCLUSIVE JURISDICTION OF THE COURTS OF THE COMONWEALTH OF
PENNSYLVANIA, THE COURTS OF THE UNITED STATES OF AMERICA FOR THE EASTERN
DISTRICT OF PENNSYLVANIA, AND APPELLATE COURTS FROM ANY THEREOF, (B) CONSENT
THAT ANY ACTION OR PROCEEDING SHALL BE BROUGHT IN SUCH COURTS, AND WAIVE ANY
OBJECTION THAT EACH MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH ACTION OR
PROCEEDING IN ANY SUCH COURT, (C) AGREE THAT SERVICE OF PROCESS OF ANY SUCH
ACTION OR PROCEEDING MAY BE EFFECTED BY CERTIFIED MAIL (OR ANY SUBSTANTIALLY
SIMILAR FORM OF MAIL), POSTAGE PREPAID, TO THE APPROPRIATE PARTY AT ITS ADDRESS
AS SET FORTH HEREIN, AND SERVICE MADE SHALL BE DEEMED TO BE COMPLETED UPON THE
EARLIER OF ACTUAL RECEIPT OR FIVE (5) DAYS AFTER THE SAME SHALL HAVE BEEN POSTED
AS AFORESAID, AND (D) AGREE THAT NOTHING HEREIN OR IN ANY EXHIBIT OR SCHEDULE
SHALL AFFECT THE RIGHT TO EFFECT SERVICE OF PROCESS IN ANY OTHER MANNER
PERMITTED BY LAW. USBPS AND THE UNDERSIGNED EACH HEREBY UNCONDITIONALLY WAIVES
ITS RIGHT TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING
OUT OF, DIRECTLY OR INDIRECTLY, THIS AGREEMENT, ANY EXHIBIT AND THE TRANSACTIONS
8
#2661-004
CONTEMPLATED HEREBY AND THEREBY, ANY OF THE RELATED DOCUMENTS, ANY DEALINGS
BETWEEN THE PARTIES HERETO RELATING TO THE SUBJECT MATTER HEREOF OR THEREOF,
AND/OR THE RELATIONSHIP THAT IS BEING ESTABLISHED BETWEEN USBPS AS AGENT FOR THE
TRUSTEE AND THE UNDERSIGNED, PROVIDED USBPS MAY IN ITS DISCRETION ENFORCE THE
TERMS OF THE FORUM SELECTION PROVISIONS IN THE LOANS.
20. SoCal, the Company and the Guarantor hereby release USBPS,
the Trustee, and the Noteholders from and against any claim, loss, or damage
arising out of the negotiation execution, and performance of the Loan or related
matters prior to the date hereof.
21. This Agreement may be executed in two or more counterparts
and each counterpart shall be deemed an original.
9
#2661-004
LYON FINANCIAL SERVICES, INC. DBA U.S.
BANK PORTFOLIO SERVICES, AS SUCCESSOR
SERVICER FOR DVI RECEIVABLES XII, L.L.C.
AND AS AGENT FOR U.S. BANK, N.A., AS TRUSTEE
By: ________________________________________
SOCAL MR SITE MANAGEMENT, INC.
By: ________________________________________
RADNET MANAGEMENT, INC.
By: ________________________________________
ACKNOWLEDGED AND AGREED TO:
Radnet Management, Inc., Guarantor
By: ______________________________
10
#2661-003
AMENDMENT TO LOAN DOCUMENTS
---------------------------
AGREEMENT made as of June 30, 2004 ("AMENDMENT AGREEMENT" or
"AGREEMENT") by and between LYON FINANCIAL SERVICES, INC. DBA U.S. BANK
PORTFOLIO SERVICES, as Successor Servicer for DVI Receivables XIV, L.L.C. and as
Agent for U.S. Bank, N.A., as Trustee, with offices at 0000 Xxxxxx Xxxxxx, Xxxxx
000, Xxxxxxxx, Xxxxxxxxx 00000 ("USBPS") and SoCal MR Site Management, Inc., a
corporation, with offices at 0000 Xxxxxx Xxxxxx, Xxx Xxxxxxx, XX 00000
("SOCAL"), and such other signatories hereto.
WHEREAS, on or about June 5, 2000, SoCal executed and
delivered to DVI Financial Services Inc. ("DVI") a Term Loan Agreement
collectively with the Secured Promissory Note Number #2661-003 dated June 5,
2000 (the "LOAN");
WHEREAS, to secure the payment of the Loan and all other
obligations of SoCal to DVI (collectively the "OBLIGATIONS"), SoCal, pursuant to
a Security Agreement dated on or about June 5, 2000 (the "SECURITY AGREEMENT"),
granted DVI a first priority security interest in certain Collateral described
therein;
WHEREAS, to further secure payment of the Note and all other
Obligations of SoCal to DVI, SoCal delivered to DVI the guarantee (the
"GUARANTEE") of Radnet Management, Inc. (the "GUARANTOR") (the "GUARANTEE"
together with the Loan and ancillary documents are, collectively the "LOAN
DOCUMENTS");
WHEREAS, substantially contemporaneously therewith, DVI
contributed all of the Loan Documents to DVI Receivables XIV, L.L.C. ("DVI XIV")
and thereafter pursuant to an Amended and Restated Indenture, DVI XIV granted a
first priority security interest in and pledged all of the Loan Documents in
favor of U.S. Bank, N.A., as Trustee, for the benefit of a
#2661-003
noteholder which purchased asset backed promissory notes issued by DVI XIV (the
"Noteholder");
WHEREAS, DVI contributed other Loans with SoCal or certain
affiliates of SoCal to this and other DVI securitizations (collectively the
"RELATED LOANS");
WHEREAS, SoCal is in default under the terms of the Loan;
WHEREAS, SoCal has requested USBPS to modify the Loan to
reflect an adjustment in payments;
WHEREAS, SoCal and/or certain of its affiliates have agreed to
modify the Related Loans;
WHEREAS, SoCal and certain of its affiliates are engaged in
negotiations to restructure or modify certain loan agreements, loans and
promissory notes with each of General Electric Capital Corporation ("GECC") and
DVI (with respect to GECC, the "GECC MODIFICATION", and with respect to DVI, the
"DVI MODIFICATION");
WHEREAS, subject to the following terms and conditions, USBPS
is willing to modify the Loan as hereinafter provided.
NOW, THEREFORE, the parties agree as follows:
1. All of the Whereas clauses are incorporated herein as if
hereinafter set forth at full length.
2. SoCal acknowledges that it is duly indebted to the Trustee
in the sum set forth on AMENDED AND RESTATED RIDER A annexed hereto, and has no
defenses, counterclaims or offsets to such indebtedness.
3. USBPS as Agent for the Trustee will modify the Loan to
provide for payments to commence in accordance with the attached revised payment
schedule (the
2
#2661-003
"AMENDED AND RESTATED RIDER A"). SoCal may, at any time, prepay all of the then
outstanding Obligations subject to an additional prepayment fee of 2% of such
Obligations. Partial prepayments of the Obligations shall not be permitted at
any time.
4. This Agreement shall become effective upon the date that
USBPS receives this Agreement duly executed by SoCal and the satisfaction of
each of the following conditions:
(a) SoCal and/or its affiliates shall have entered
into agreements on similar terms to this Agreement and
otherwise in form and substance satisfactory to USBPS,
relating to the Related Loans (the "Related Loan
Modifications");
(b) reimbursement of USBPS's legal fees incurred in
connection with the execution of this Agreement and the
Related Loan Modifications, aggregating $50,000, shall have
been received by USBPS;
(c) SoCal and/or its affiliates shall have entered
into the GECC Modification and the DVI Modification. 5. The
closing of the restructuring of the SoCal Loan is further
subject to delivery to USBPS of all of the following, each in
form and substance satisfactory to USBPS and its counsel:
(a) The executed AMENDED AND RESTATED RIDER A;
(b) An executed copy of this Agreement;
(c) Such other documents, including UCC financing
statements as USBPS reasonably requests.
6. SoCal hereby acknowledges and agrees that it has no, and
will not assert any, defenses, counterclaims or offsets to the Loan and AMENDED
AND RESTATED RIDER A and acknowledges and agrees that the Trustee holds a
first-priority security interest in the Collateral.
7. Any default or other breach of any obligation under the
GECC Modification, the DVI Modification, or any of the Related Loan
Modifications shall constitute a
3
#2661-003
default under the Loan as modified by this Agreement, and USBPS shall have all
remedies thereunder.
8. SoCal hereby releases the Noteholder, USBPS individually
and as agent for the Trustee and the special purpose entities for which the
Trustee holds collateral, from and against any claims, loss or damage of any
kind or nature arising out of the Loan.
9. So long as any of the Obligations remain outstanding,
Radnet Management, Inc. (the "COMPANY") agrees as follows:
(i) FINANCIAL REPORTING. The Company shall furnish
the following documents or information to USBPS:
(A) Within 30 days after the end of each
Fiscal Quarter (as defined below) (i) (or 90 days in respect of the last month
of the fiscal year), the Company's consolidated, consolidating and on a center
by center basis, financial statements, including the most recent annual report,
balance sheet (not on a center by center basis) and income statement, prepared
in accordance with generally accepted accounting principles, which reports, the
Company warrants, shall fully and fairly represent the true financial condition
of the Company and (ii) updated projections for the Company and for each center;
(B) any other financial information normally
provided by the Company to the public; and
(C) Such other financial data or information
relative to this Amendment Agreement, including, without limitation, listings of
serial numbers or other identification data and confirmations of such
information, as USBPS may time-to-time reasonably request.
(ii) NO AMENDMENTS. Subsequent to the date of this
Amendment Agreement, the Company will not agree or consent to any amendments or
modifications to any agreement between the Company and DVI, GECC or Xxxxx Fargo
Foothill, Inc. ("FOOTHILL") containing terms (including, but not limited to,
increasing interest rates, accelerating the principal amortization or maturity,
new or more stringent defaults, additional collateral, and new remedies
provisions) that would be more onerous to the Company, or adversely impact or
affect GECC with respect to the terms of this Amendment Agreement.
(iii) DISTRIBUTIONS. The Company shall not make any
distribution or declare or pay any dividends (in cash or other property, other
than common stock) on, or purchase, acquire, redeem, or retire any of the
Company's stock, of any class, whether now or hereafter outstanding
(collectively, "DISTRIBUTIONS"); PROVIDED, HOWEVER, that so long as no
4
#2661-003
default shall have occurred and be continuing immediately prior to or after
giving effect to any such payment, (a) the Company may make Distributions to
Primedex Health Systems, Inc., a New York corporation (the "PARENT") (1) in
amounts necessary to pay customary expenses of Parent in the ordinary course of
its business as a public holding company (including salaries and related
reasonable and customary expenses incurred by employees of Parent) in an
aggregate amount not to exceed $750,000 in any fiscal year, (2) in amounts
necessary to enable Parent to pay taxes when due and owing by it in the ordinary
course of its business as a holding company and (3) in amounts necessary to
enable Parent to pay interest on those certain 11.5% Series A Convertible
Subordinated Notes due June 30, 2008, issued by Parent on June 25, 1993, and (b)
Parent may make Distributions in the form of common stock.
(iv) FIXED CHARGE COVERAGE RATIO. Commencing April
30, 2005, the Company shall not permit the Fixed Charge Coverage Ratio, (a) to
be less than 1.0:1 as of the end of each April, July, October and January (each,
a "FISCAL QUARTER") ending prior to January 1, 2007, and (b) to be less than
1.05:1 as of the last day of each Fiscal Quarter ending thereafter. "FIXED
CHARGE COVERAGE RATIO" means for any period, the ratio of (i) EBITDA for such
period MINUS cash capital expenditures made (to the extent not already incurred
in a prior period) or incurred during such period, to (ii) the sum of (a)
interest expense, (b) principal payments required to be paid during such period
in respect of indebtedness, and (c) all federal, state, and local income taxes
accrued, all as determined for the twelve months ending on the determination
date for the Company and its subsidiaries on a consolidated basis without
duplication and in accordance with generally accepted accounting principles
consistently applied. "EBITDA" means, with respect to any fiscal period, the
Company's and its subsidiaries' consolidated net earnings (or loss), minus
extraordinary gains and interest income, plus interest expense, income taxes,
and depreciation and amortization for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(v) LEVERAGE RATIO. The Company shall not permit the
Leverage Ratio, as determined as of the end of each Fiscal Quarter, to be
greater than the amount set forth in the following table for the Fiscal Quarters
ending in the period set forth opposite thereto:
LEVERAGE RATIO PERIOD
-------------- ------
4.50:1.0 04/30/05 - 10/30/05
4.30:1.0 10/31/05 - 10/30/06
4.00:1.0 10/31/06 - 10/30/07
3.80:1.0 10/31/07 - 10/30/08
"LEVERAGE RATIO" means, at any date of determination, the
ratio of (a) Total Debt at such date to (b) EBITDA for the applicable period
ending on such date. "TOTAL DEBT" means, as of any date of determination,
without duplication, the sum of (a) the outstanding aggregate amount of the
obligations for borrowed money, (b) the outstanding principal amount of capital
leases, (c) the outstanding principal amount of purchase money indebtedness, (d)
the outstanding principal amount of funded debt, and (e) the outstanding
principal amount of all obligations
5
#2661-003
owing to GECC, DVI and USBPS; all as determined for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(vi) EBITDA MARGIN. The Company shall not permit the
EBITDA Margin to be less than 25% as of the end of any Fiscal Quarter ending on
or after April 30, 2005. "EBITDA MARGIN" means for any period, the ratio of (a)
EBITDA for such period, to (b) net revenues (excluding the professional service
fee component of radiology services) for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(vii) RECEIVABLE DAYS. The Company shall not permit
the Receivable Days to exceed 65 days as of the end of any Fiscal Quarter ending
on or after April 30, 2005. "RECEIVABLE DAYS" means for any period, a number
equal to (a) 365 divided by (b) the result of (i) net revenues for such period
divided by (ii) net receivables for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(viii) NAME CHANGES, ETC. The Company agrees that it
shall not change its name or jurisdiction of organization without giving 30 days
prior written notice to USBPS.
10. To induce USBPS on behalf of the Trustee to enter this
Agreement, the Guarantor hereby affirms and restates its Guarantee as related to
this Loan and AMENDED AND RESTATED RIDER A.
11. SoCal, the Company and the Guarantor each represent and
warrant that each has been represented by an attorney of its choice and is fully
aware of the terms contained in this Agreement and AMENDED AND RESTATED RIDER A
to which it is a party which was voluntarily entered into without coercion or
duress of any kind.
12. SoCal represents and warrants to USBPS on behalf of the
Noteholders and Trustee that all necessary actions on the part of SoCal to be
taken in connection with the execution, delivery and performance of this
Agreement have been taken; the performance by SoCal of this Agreement and the
AMENDED AND RESTATED RIDER A will not violate any of SoCal's
6
#2661-003
Articles of Incorporation, Articles of Formation, Partnership Agreement or other
agreement or law by which SoCal is bound.
13. Any notice, request, direction, consent, approval, waiver
or other communication required or permitted under this Agreement to be sent
must be in writing and will become effective only upon delivery to USBPS at the
address set forth herein as follows:
U.S. Bank Portfolio Services
0000 Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxx, XX 00000
Attn: Xxxx Xxx, Director of Operations
14. Except as provided herein, and in the AMENDED AND RESTATED
RIDER A, all of the other provisions of the Loan Documents not restated will
remain in effect.
15. This Agreement and the documents referenced herein
constitute the entire and final agreement among the parties with respect to the
subject matter hereof and there are no agreements, understandings, warranties or
representations among the parties with respect to these matters except as set
forth herein.
16. This Agreement will inure to the benefit of and bind the
parties and their respective successors and permitted assigns.
17. Neither this Agreement nor any of the provisions hereof
can be changed, waived, discharged or terminated except by an instrument in
writing signed by the parties against whom such enforcement of the change,
waiver, discharge or termination is sought.
18. This Agreement will be interpreted and construed under the
laws of the Commonwealth of Pennsylvania, regardless of the domicile of any
party and will be considered to have been made, executed and performed in
Pennsylvania.
7
#2661-003
19. THE UNDERSIGNED, AND SUBJECT TO THE PROVISIONS CONTAINED
HEREIN, USBPS FOR ITSELF AND AS AGENT FOR THE TRUSTEE, (A) AGREE TO SUBMIT FOR
THEMSELVES, IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT AND ANY
SCHEDULE OR FOR RECOGNITION AND ENFORCEMENT OF ANY JUDGMENT IN RESPECT HEREOF OR
THEREOF, TO THE EXCLUSIVE JURISDICTION OF THE COURTS OF THE COMONWEALTH OF
PENNSYLVANIA, THE COURTS OF THE UNITED STATES OF AMERICA FOR THE EASTERN
DISTRICT OF PENNSYLVANIA, AND APPELLATE COURTS FROM ANY THEREOF, (B) CONSENT
THAT ANY ACTION OR PROCEEDING SHALL BE BROUGHT IN SUCH COURTS, AND WAIVE ANY
OBJECTION THAT EACH MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH ACTION OR
PROCEEDING IN ANY SUCH COURT, (C) AGREE THAT SERVICE OF PROCESS OF ANY SUCH
ACTION OR PROCEEDING MAY BE EFFECTED BY CERTIFIED MAIL (OR ANY SUBSTANTIALLY
SIMILAR FORM OF MAIL), POSTAGE PREPAID, TO THE APPROPRIATE PARTY AT ITS ADDRESS
AS SET FORTH HEREIN, AND SERVICE MADE SHALL BE DEEMED TO BE COMPLETED UPON THE
EARLIER OF ACTUAL RECEIPT OR FIVE (5) DAYS AFTER THE SAME SHALL HAVE BEEN POSTED
AS AFORESAID, AND (D) AGREE THAT NOTHING HEREIN OR IN ANY EXHIBIT OR SCHEDULE
SHALL AFFECT THE RIGHT TO EFFECT SERVICE OF PROCESS IN ANY OTHER MANNER
PERMITTED BY LAW. USBPS AND THE UNDERSIGNED EACH HEREBY UNCONDITIONALLY WAIVES
ITS RIGHT TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING
OUT OF, DIRECTLY OR INDIRECTLY, THIS AGREEMENT, ANY EXHIBIT AND THE TRANSACTIONS
8
#2661-003
CONTEMPLATED HEREBY AND THEREBY, ANY OF THE RELATED DOCUMENTS, ANY DEALINGS
BETWEEN THE PARTIES HERETO RELATING TO THE SUBJECT MATTER HEREOF OR THEREOF,
AND/OR THE RELATIONSHIP THAT IS BEING ESTABLISHED BETWEEN USBPS AS AGENT FOR THE
TRUSTEE AND THE UNDERSIGNED, PROVIDED USBPS MAY IN ITS DISCRETION ENFORCE THE
TERMS OF THE FORUM SELECTION PROVISIONS IN THE LOANS.
20. SoCal, the Company and the Guarantor hereby release USBPS,
the Trustee, and the Noteholders from and against any claim, loss, or damage
arising out of the negotiation execution, and performance of the Loan or related
matters prior to the date hereof.
21. This Agreement may be executed in two or more counterparts
and each counterpart shall be deemed an original.
9
#2661-003
LYON FINANCIAL SERVICES, INC. DBA U.S.
BANK PORTFOLIO SERVICES, AS SUCCESSOR
SERVICER FOR DVI RECEIVABLES XIV, L.L.C.
AND AS AGENT FOR U.S. BANK, N.A., AS TRUSTEE
By: ________________________________________
SOCAL MR SITE MANAGEMENT, INC.
By: ________________________________________
RADNET MANAGEMENT, INC.
By: ________________________________________
ACKNOWLEDGED AND AGREED TO:
Radnet Management, Inc., Guarantor
By: _______________________________
10
#2661-002
AMENDMENT TO LOAN DOCUMENTS
---------------------------
AGREEMENT made as of June 30, 2004 ("AMENDMENT AGREEMENT" or
"AGREEMENT") by and between LYON FINANCIAL SERVICES, INC. DBA U.S. BANK
PORTFOLIO SERVICES, as Successor Servicer for DVI Receivables XIV, L.L.C. and as
Agent for U.S. Bank, N.A., as Trustee, with offices at 0000 Xxxxxx Xxxxxx, Xxxxx
000, Xxxxxxxx, Xxxxxxxxx 00000 ("USBPS") and SoCal MR Site Management, Inc., a
corporation, with offices at 0000 Xxxxxx Xxxxxx, Xxx Xxxxxxx, XX 00000
("SOCAL"), and such other signatories hereto.
WHEREAS, on or about June 5, 2000, SoCal executed and
delivered to DVI Financial Services Inc. ("DVI") a Term Loan Agreement
collectively with the Secured Promissory Note Number #2661-002 dated June 5,
2000 (the "LOAN");
WHEREAS, to secure the payment of the Loan and all other
obligations of SoCal to DVI (collectively the "OBLIGATIONS"), SoCal, pursuant to
a Security Agreement dated on or about June 5, 2000 (the "SECURITY AGREEMENT"),
granted DVI a first priority security interest in certain Collateral described
therein;
WHEREAS, to further secure payment of the Note and all other
Obligations of SoCal to DVI, SoCal delivered to DVI the guarantee (the
"GUARANTEE") of Radnet Management, Inc. (the "GUARANTOR") (the "GUARANTEE"
together with the Loan and ancillary documents are, collectively the "LOAN
DOCUMENTS");
WHEREAS, substantially contemporaneously therewith, DVI
contributed all of the Loan Documents to DVI Receivables XIV, L.L.C. ("DVI XIV")
and thereafter pursuant to an Amended and Restated Indenture, DVI XIV granted a
first priority security interest in and pledged all of the Loan Documents in
favor of U.S. Bank, N.A., as Trustee, for the benefit of a
#2661-002
noteholder which purchased asset backed promissory notes issued by DVI XIV (the
"Noteholder");
WHEREAS, DVI contributed other Loans with SoCal or certain
affiliates of SoCal to this and other DVI securitizations (collectively the
"RELATED LOANS");
WHEREAS, SoCal is in default under the terms of the Loan;
WHEREAS, SoCal has requested USBPS to modify the Loan to
reflect an adjustment in payments;
WHEREAS, SoCal and/or certain of its affiliates have agreed to
modify the Related Loans;
WHEREAS, SoCal and certain of its affiliates are engaged in
negotiations to restructure or modify certain loan agreements, loans and
promissory notes with each of General Electric Capital Corporation ("GECC") and
DVI (with respect to GECC, the "GECC MODIFICATION", and with respect to DVI, the
"DVI MODIFICATION");
WHEREAS, subject to the following terms and conditions, USBPS
is willing to modify the Loan as hereinafter provided.
NOW, THEREFORE, the parties agree as follows:
1. All of the Whereas clauses are incorporated herein as if
hereinafter set forth at full length.
2. SoCal acknowledges that it is duly indebted to the Trustee
in the sum set forth on AMENDED AND RESTATED RIDER A annexed hereto, and has no
defenses, counterclaims or offsets to such indebtedness.
3. USBPS as Agent for the Trustee will modify the Loan to
provide for payments to commence in accordance with the attached revised payment
schedule (the
2
#2661-002
"AMENDED AND RESTATED RIDER A"). SoCal may, at any time, prepay all of the then
outstanding Obligations subject to an additional prepayment fee of 2% of such
Obligations. Partial prepayments of the Obligations shall not be permitted at
any time.
4. This Agreement shall become effective upon the date that
USBPS receives this Agreement duly executed by SoCal and the satisfaction of
each of the following conditions:
(a) SoCal and/or its affiliates shall have entered
into agreements on similar terms to this Agreement and
otherwise in form and substance satisfactory to USBPS,
relating to the Related Loans (the "Related Loan
Modifications");
(b) reimbursement of USBPS's legal fees incurred in
connection with the execution of this Agreement and the
Related Loan Modifications, aggregating $50,000, shall have
been received by USBPS;
(c) SoCal and/or its affiliates shall have entered
into the GECC Modification and the DVI Modification.
5. The closing of the restructuring of the SoCal Loan is
further subject to delivery to USBPS of all of the following, each in form and
substance satisfactory to USBPS and its counsel:
(a) The executed AMENDED AND RESTATED RIDER A;
(b) An executed copy of this Agreement;
(c) Such other documents, including UCC financing
statements as USBPS reasonably requests.
6. SoCal hereby acknowledges and agrees that it has no, and
will not assert any, defenses, counterclaims or offsets to the Loan and AMENDED
AND RESTATED RIDER A and acknowledges and agrees that the Trustee holds a
first-priority security interest in the Collateral.
7. Any default or other breach of any obligation under the
GECC Modification, the DVI Modification, or any of the Related Loan
Modifications shall constitute a
3
#2661-002
default under the Loan as modified by this Agreement, and USBPS shall have all
remedies thereunder.
8. SoCal hereby releases the Noteholder, USBPS individually
and as agent for the Trustee and the special purpose entities for which the
Trustee holds collateral, from and against any claims, loss or damage of any
kind or nature arising out of the Loan.
9. So long as any of the Obligations remain outstanding,
Radnet Management, Inc. (the "COMPANY") agrees as follows:
(i) FINANCIAL REPORTING. The Company shall furnish
the following documents or information to USBPS:
(A) Within 30 days after the end of each
Fiscal Quarter (as defined below) (i) (or 90 days in respect of the last month
of the fiscal year), the Company's consolidated, consolidating and on a center
by center basis, financial statements, including the most recent annual report,
balance sheet (not on a center by center basis) and income statement, prepared
in accordance with generally accepted accounting principles, which reports, the
Company warrants, shall fully and fairly represent the true financial condition
of the Company and (ii) updated projections for the Company and for each center;
(B) any other financial information normally
provided by the Company to the public; and
(C) Such other financial data or information
relative to this Amendment Agreement, including, without limitation, listings of
serial numbers or other identification data and confirmations of such
information, as USBPS may time-to-time reasonably request.
(ii) NO AMENDMENTS. Subsequent to the date of this
Amendment Agreement, the Company will not agree or consent to any amendments or
modifications to any agreement between the Company and DVI, GECC or Xxxxx Fargo
Foothill, Inc. ("FOOTHILL") containing terms (including, but not limited to,
increasing interest rates, accelerating the principal amortization or maturity,
new or more stringent defaults, additional collateral, and new remedies
provisions) that would be more onerous to the Company, or adversely impact or
affect GECC with respect to the terms of this Amendment Agreement.
(iii) DISTRIBUTIONS. The Company shall not make any
distribution or declare or pay any dividends (in cash or other property, other
than common stock) on, or purchase, acquire, redeem, or retire any of the
Company's stock, of any class, whether now or hereafter outstanding
(collectively, "DISTRIBUTIONS"); PROVIDED, HOWEVER, that so long as no
4
#2661-002
default shall have occurred and be continuing immediately prior to or after
giving effect to any such payment, (a) the Company may make Distributions to
Primedex Health Systems, Inc., a New York corporation (the "PARENT") (1) in
amounts necessary to pay customary expenses of Parent in the ordinary course of
its business as a public holding company (including salaries and related
reasonable and customary expenses incurred by employees of Parent) in an
aggregate amount not to exceed $750,000 in any fiscal year, (2) in amounts
necessary to enable Parent to pay taxes when due and owing by it in the ordinary
course of its business as a holding company and (3) in amounts necessary to
enable Parent to pay interest on those certain 11.5% Series A Convertible
Subordinated Notes due June 30, 2008, issued by Parent on June 25, 1993, and (b)
Parent may make Distributions in the form of common stock.
(iv) FIXED CHARGE COVERAGE RATIO. Commencing April
30, 2005, the Company shall not permit the Fixed Charge Coverage Ratio, (a) to
be less than 1.0:1 as of the end of each April, July, October and January (each,
a "FISCAL QUARTER") ending prior to January 1, 2007, and (b) to be less than
1.05:1 as of the last day of each Fiscal Quarter ending thereafter. "FIXED
CHARGE COVERAGE RATIO" means for any period, the ratio of (i) EBITDA for such
period minus cash capital expenditures made (to the extent not already incurred
in a prior period) or incurred during such period, to (ii) the sum of (a)
interest expense, (b) principal payments required to be paid during such period
in respect of indebtedness, and (c) all federal, state, and local income taxes
accrued, all as determined for the twelve months ending on the determination
date for the Company and its subsidiaries on a consolidated basis without
duplication and in accordance with generally accepted accounting principles
consistently applied. "EBITDA" means, with respect to any fiscal period, the
Company's and its subsidiaries' consolidated net earnings (or loss), minus
extraordinary gains and interest income, plus interest expense, income taxes,
and depreciation and amortization for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(v) LEVERAGE RATIO. The Company shall not permit the
Leverage Ratio, as determined as of the end of each Fiscal Quarter, to be
greater than the amount set forth in the following table for the Fiscal Quarters
ending in the period set forth opposite thereto:
LEVERAGE RATIO PERIOD
-------------- ------
4.50:1.0 04/30/05 - 10/30/05
4.30:1.0 10/31/05 - 10/30/06
4.00:1.0 10/31/06 - 10/30/07
3.80:1.0 10/31/07 - 10/30/08
"LEVERAGE RATIO" means, at any date of determination, the
ratio of (a) Total Debt at such date to (b) EBITDA for the applicable period
ending on such date. "TOTAL DEBT" means, as of any date of determination,
without duplication, the sum of (a) the outstanding aggregate amount of the
obligations for borrowed money, (b) the outstanding principal amount of capital
leases, (c) the outstanding principal amount of purchase money indebtedness, (d)
the outstanding principal amount of funded debt, and (e) the outstanding
principal amount of all obligations
5
#2661-002
owing to GECC, DVI and USBPS; all as determined for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(vi) EBITDA MARGIN. The Company shall not permit the
EBITDA Margin to be less than 25% as of the end of any Fiscal Quarter ending on
or after April 30, 2005. "EBITDA MARGIN" means for any period, the ratio of (a)
EBITDA for such period, to (b) net revenues (excluding the professional service
fee component of radiology services) for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(vii) RECEIVABLE DAYS. The Company shall not permit
the Receivable Days to exceed 65 days as of the end of any Fiscal Quarter ending
on or after April 30, 2005. "RECEIVABLE DAYS" means for any period, a number
equal to (a) 365 divided by (b) the result of (i) net revenues for such period
divided by (ii) net receivables for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(viii) NAME CHANGES, ETC. The Company agrees that it
shall not change its name or jurisdiction of organization without giving 30 days
prior written notice to USBPS.
10. To induce USBPS on behalf of the Trustee to enter this
Agreement, the Guarantor hereby affirms and restates its Guarantee as related to
this Loan and AMENDED AND RESTATED RIDER A.
11. SoCal, the Company and the Guarantor each represent and
warrant that each has been represented by an attorney of its choice and is fully
aware of the terms contained in this Agreement and AMENDED AND RESTATED RIDER A
to which it is a party which was voluntarily entered into without coercion or
duress of any kind.
12. SoCal represents and warrants to USBPS on behalf of the
Noteholders and Trustee that all necessary actions on the part of SoCal to be
taken in connection with the execution, delivery and performance of this
Agreement have been taken; the performance by SoCal of this Agreement and the
AMENDED AND RESTATED RIDER A will not violate any of SoCal's
6
#2661-002
Articles of Incorporation, Articles of Formation, Partnership Agreement or other
agreement or law by which SoCal is bound.
13. Any notice, request, direction, consent, approval, waiver
or other communication required or permitted under this Agreement to be sent
must be in writing and will become effective only upon delivery to USBPS at the
address set forth herein as follows:
U.S. Bank Portfolio Services
0000 Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxx, XX 00000
Attn: Xxxx Xxx, Director of Operations
14. Except as provided herein, and in the AMENDED AND RESTATED
RIDER A, all of the other provisions of the Loan Documents not restated will
remain in effect.
15. This Agreement and the documents referenced herein
constitute the entire and final agreement among the parties with respect to the
subject matter hereof and there are no agreements, understandings, warranties or
representations among the parties with respect to these matters except as set
forth herein.
16. This Agreement will inure to the benefit of and bind the
parties and their respective successors and permitted assigns.
17. Neither this Agreement nor any of the provisions hereof
can be changed, waived, discharged or terminated except by an instrument in
writing signed by the parties against whom such enforcement of the change,
waiver, discharge or termination is sought.
18. This Agreement will be interpreted and construed under the
laws of the Commonwealth of Pennsylvania, regardless of the domicile of any
party and will be considered to have been made, executed and performed in
Pennsylvania.
7
#2661-002
19. THE UNDERSIGNED, AND SUBJECT TO THE PROVISIONS CONTAINED
HEREIN, USBPS FOR ITSELF AND AS AGENT FOR THE TRUSTEE, (A) AGREE TO SUBMIT FOR
THEMSELVES, IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT AND ANY
SCHEDULE OR FOR RECOGNITION AND ENFORCEMENT OF ANY JUDGMENT IN RESPECT HEREOF OR
THEREOF, TO THE EXCLUSIVE JURISDICTION OF THE COURTS OF THE COMONWEALTH OF
PENNSYLVANIA, THE COURTS OF THE UNITED STATES OF AMERICA FOR THE EASTERN
DISTRICT OF PENNSYLVANIA, AND APPELLATE COURTS FROM ANY THEREOF, (B) CONSENT
THAT ANY ACTION OR PROCEEDING SHALL BE BROUGHT IN SUCH COURTS, AND WAIVE ANY
OBJECTION THAT EACH MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH ACTION OR
PROCEEDING IN ANY SUCH COURT, (C) AGREE THAT SERVICE OF PROCESS OF ANY SUCH
ACTION OR PROCEEDING MAY BE EFFECTED BY CERTIFIED MAIL (OR ANY SUBSTANTIALLY
SIMILAR FORM OF MAIL), POSTAGE PREPAID, TO THE APPROPRIATE PARTY AT ITS ADDRESS
AS SET FORTH HEREIN, AND SERVICE MADE SHALL BE DEEMED TO BE COMPLETED UPON THE
EARLIER OF ACTUAL RECEIPT OR FIVE (5) DAYS AFTER THE SAME SHALL HAVE BEEN POSTED
AS AFORESAID, AND (D) AGREE THAT NOTHING HEREIN OR IN ANY EXHIBIT OR SCHEDULE
SHALL AFFECT THE RIGHT TO EFFECT SERVICE OF PROCESS IN ANY OTHER MANNER
PERMITTED BY LAW. USBPS AND THE UNDERSIGNED EACH HEREBY UNCONDITIONALLY WAIVES
ITS RIGHT TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING
OUT OF, DIRECTLY OR INDIRECTLY, THIS AGREEMENT, ANY EXHIBIT AND THE TRANSACTIONS
8
#2661-002
CONTEMPLATED HEREBY AND THEREBY, ANY OF THE RELATED DOCUMENTS, ANY DEALINGS
BETWEEN THE PARTIES HERETO RELATING TO THE SUBJECT MATTER HEREOF OR THEREOF,
AND/OR THE RELATIONSHIP THAT IS BEING ESTABLISHED BETWEEN USBPS AS AGENT FOR THE
TRUSTEE AND THE UNDERSIGNED, PROVIDED USBPS MAY IN ITS DISCRETION ENFORCE THE
TERMS OF THE FORUM SELECTION PROVISIONS IN THE LOANS.
20. SoCal, the Company and the Guarantor hereby release USBPS,
the Trustee, and the Noteholders from and against any claim, loss, or damage
arising out of the negotiation execution, and performance of the Loan or related
matters prior to the date hereof.
21. This Agreement may be executed in two or more counterparts
and each counterpart shall be deemed an original.
9
#2661-002
LYON FINANCIAL SERVICES, INC. DBA U.S.
BANK PORTFOLIO SERVICES, AS SUCCESSOR
SERVICER FOR DVI RECEIVABLES XIV, L.L.C.
AND AS AGENT FOR U.S. BANK, N.A., AS TRUSTEE
By: ________________________________________
SOCAL MR SITE MANAGEMENT, INC.
By: ________________________________________
RADNET MANAGEMENT, INC.
By: ________________________________________
ACKNOWLEDGED AND AGREED TO:
Radnet Management, Inc., Guarantor
By: ______________________________
10
#2661-001
AMENDMENT TO LOAN DOCUMENTS
---------------------------
AGREEMENT made as of June 30, 2004 ("AMENDMENT AGREEMENT" or
"AGREEMENT") by and between LYON FINANCIAL SERVICES, INC. DBA U.S. BANK
PORTFOLIO SERVICES, as Successor Servicer for DVI Receivables XII, L.L.C. and as
Agent for U.S. Bank, N.A., as Trustee, with offices at 0000 Xxxxxx Xxxxxx, Xxxxx
000, Xxxxxxxx, Xxxxxxxxx 00000 ("USBPS") and SoCal MR Site Management, Inc., a
corporation, with offices at 0000 Xxxxxx Xxxxxx, Xxx Xxxxxxx, XX 00000
("SOCAL"), and such other signatories hereto.
WHEREAS, on or about June 5, 2000, SoCal executed and
delivered to DVI Financial Services Inc. ("DVI") a Term Loan Agreement
collectively with the Secured Promissory Note Number #2661-001 dated June 5,
2000 (the "LOAN");
WHEREAS, to secure the payment of the Loan and all other
obligations of SoCal to DVI (collectively the "OBLIGATIONS"), SoCal, pursuant to
a Security Agreement dated on or about June 5, 2000 (the "SECURITY AGREEMENT"),
granted DVI a first priority security interest in certain Collateral described
therein;
WHEREAS, to further secure payment of the Note and all other
Obligations of SoCal to DVI, SoCal delivered to DVI the guarantee (the
"GUARANTEE") of Radnet Management, Inc. (the "GUARANTOR") (the "GUARANTEE"
together with the Loan and ancillary documents are, collectively the "LOAN
DOCUMENTS");
WHEREAS, substantially contemporaneously therewith, DVI
contributed all of the Loan Documents to DVI Receivables XII, L.L.C. ("DVI XII")
and thereafter pursuant to an Amended and Restated Indenture, DVI XII granted a
first priority security interest in and pledged all of the Loan Documents in
favor of U.S. Bank, N.A., as Trustee, for the benefit of a
#2661-001
noteholder which purchased asset backed promissory notes issued by DVI XII (the
"Noteholder");
WHEREAS, DVI contributed other Loans with SoCal or certain
affiliates of SoCal to this and other DVI securitizations (collectively the
"RELATED LOANS");
WHEREAS, SoCal is in default under the terms of the Loan;
WHEREAS, SoCal has requested USBPS to modify the Loan to
reflect an adjustment in payments;
WHEREAS, SoCal and/or certain of its affiliates have agreed to
modify the Related Loans;
WHEREAS, SoCal and certain of its affiliates are engaged in
negotiations to restructure or modify certain loan agreements, loans and
promissory notes with each of General Electric Capital Corporation ("GECC") and
DVI (with respect to GECC, the "GECC MODIFICATION", and with respect to DVI, the
"DVI MODIFICATION");
WHEREAS, subject to the following terms and conditions, USBPS
is willing to modify the Loan as hereinafter provided.
NOW, THEREFORE, the parties agree as follows:
1. All of the Whereas clauses are incorporated herein as if
hereinafter set forth at full length.
2. SoCal acknowledges that it is duly indebted to the Trustee
in the sum set forth on AMENDED AND RESTATED RIDER A annexed hereto, and has no
defenses, counterclaims or offsets to such indebtedness.
3. USBPS as Agent for the Trustee will modify the Loan to
provide for payments to commence in accordance with the attached revised payment
schedule (the
2
#2661-001
"AMENDED AND RESTATED RIDER A"). SoCal may, at any time, prepay all of the then
outstanding Obligations subject to an additional prepayment fee of 2% of such
Obligations. Partial prepayments of the Obligations shall not be permitted at
any time.
4. This Agreement shall become effective upon the date that
USBPS receives this Agreement duly executed by SoCal and the satisfaction of
each of the following conditions:
(a) SoCal and/or its affiliates shall have entered
into agreements on similar terms to this Agreement and
otherwise in form and substance satisfactory to USBPS,
relating to the Related Loans (the "Related Loan
Modifications");
(b) reimbursement of USBPS's legal fees incurred in
connection with the execution of this Agreement and the
Related Loan Modifications, aggregating $50,000, shall have
been received by USBPS;
(c) SoCal and/or its affiliates shall have entered
into the GECC Modification and the DVI Modification.
5. The closing of the restructuring of the SoCal Loan is
further subject to delivery to USBPS of all of the following, each in form and
substance satisfactory to USBPS and its counsel:
(a) The executed AMENDED AND RESTATED RIDER A;
(b) An executed copy of this Agreement;
(c) Such other documents, including UCC financing
statements as USBPS reasonably requests.
6. SoCal hereby acknowledges and agrees that it has no, and
will not assert any, defenses, counterclaims or offsets to the Loan and AMENDED
AND RESTATED RIDER A and acknowledges and agrees that the Trustee holds a
first-priority security interest in the Collateral.
7. Any default or other breach of any obligation under the
GECC Modification, the DVI Modification, or any of the Related Loan
Modifications shall constitute a
3
#2661-001
default under the Loan as modified by this Agreement, and USBPS shall have all
remedies thereunder.
8. SoCal hereby releases the Noteholder, USBPS individually
and as agent for the Trustee and the special purpose entities for which the
Trustee holds collateral, from and against any claims, loss or damage of any
kind or nature arising out of the Loan.
9. So long as any of the Obligations remain outstanding,
Radnet Management, Inc. (the "COMPANY") agrees as follows:
(i) FINANCIAL REPORTING. The Company shall furnish
the following documents or information to USBPS:
(A) Within 30 days after the end of each
Fiscal Quarter (as defined below) (i) (or 90 days in respect of the last month
of the fiscal year), the Company's consolidated, consolidating and on a center
by center basis, financial statements, including the most recent annual report,
balance sheet (not on a center by center basis) and income statement, prepared
in accordance with generally accepted accounting principles, which reports, the
Company warrants, shall fully and fairly represent the true financial condition
of the Company and (ii) updated projections for the Company and for each center;
(B) any other financial information normally
provided by the Company to the public; and
(C) Such other financial data or information
relative to this Amendment Agreement, including, without limitation, listings of
serial numbers or other identification data and confirmations of such
information, as USBPS may time-to-time reasonably request.
(ii) NO AMENDMENTS. Subsequent to the date of this
Amendment Agreement, the Company will not agree or consent to any amendments or
modifications to any agreement between the Company and DVI, GECC or Xxxxx Fargo
Foothill, Inc. ("FOOTHILL") containing terms (including, but not limited to,
increasing interest rates, accelerating the principal amortization or maturity,
new or more stringent defaults, additional collateral, and new remedies
provisions) that would be more onerous to the Company, or adversely impact or
affect GECC with respect to the terms of this Amendment Agreement.
(iii) DISTRIBUTIONS. The Company shall not make any
distribution or declare or pay any dividends (in cash or other property, other
than common stock) on, or purchase, acquire, redeem, or retire any of the
Company's stock, of any class, whether now or hereafter outstanding
(collectively, "DISTRIBUTIONS"); PROVIDED, HOWEVER, that so long as no
4
#2661-001
default shall have occurred and be continuing immediately prior to or after
giving effect to any such payment, (a) the Company may make Distributions to
Primedex Health Systems, Inc., a New York corporation (the "PARENT") (1) in
amounts necessary to pay customary expenses of Parent in the ordinary course of
its business as a public holding company (including salaries and related
reasonable and customary expenses incurred by employees of Parent) in an
aggregate amount not to exceed $750,000 in any fiscal year, (2) in amounts
necessary to enable Parent to pay taxes when due and owing by it in the ordinary
course of its business as a holding company and (3) in amounts necessary to
enable Parent to pay interest on those certain 11.5% Series A Convertible
Subordinated Notes due June 30, 2008, issued by Parent on June 25, 1993, and (b)
Parent may make Distributions in the form of common stock.
(iv) FIXED CHARGE COVERAGE RATIO. Commencing April
30, 2005, the Company shall not permit the Fixed Charge Coverage Ratio, (a) to
be less than 1.0:1 as of the end of each April, July, October and January (each,
a "FISCAL QUARTER") ending prior to January 1, 2007, and (b) to be less than
1.05:1 as of the last day of each Fiscal Quarter ending thereafter. "FIXED
CHARGE COVERAGE RATIO" means for any period, the ratio of (i) EBITDA for such
period minus cash capital expenditures made (to the extent not already incurred
in a prior period) or incurred during such period, to (ii) the sum of (a)
interest expense, (b) principal payments required to be paid during such period
in respect of indebtedness, and (c) all federal, state, and local income taxes
accrued, all as determined for the twelve months ending on the determination
date for the Company and its subsidiaries on a consolidated basis without
duplication and in accordance with generally accepted accounting principles
consistently applied. "EBITDA" means, with respect to any fiscal period, the
Company's and its subsidiaries' consolidated net earnings (or loss), minus
extraordinary gains and interest income, plus interest expense, income taxes,
and depreciation and amortization for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(v) LEVERAGE RATIO. The Company shall not permit the
Leverage Ratio, as determined as of the end of each Fiscal Quarter, to be
greater than the amount set forth in the following table for the Fiscal Quarters
ending in the period set forth opposite thereto:
LEVERAGE RATIO PERIOD
-------------- ------
4.50:1.0 04/30/05 - 10/30/05
4.30:1.0 10/31/05 - 10/30/06
4.00:1.0 10/31/06 - 10/30/07
3.80:1.0 10/31/07 - 10/30/08
"LEVERAGE RATIO" means, at any date of determination, the
ratio of (a) Total Debt at such date to (b) EBITDA for the applicable period
ending on such date. "TOTAL DEBT" means, as of any date of determination,
without duplication, the sum of (a) the outstanding aggregate amount of the
obligations for borrowed money, (b) the outstanding principal amount of capital
leases, (c) the outstanding principal amount of purchase money indebtedness, (d)
the outstanding principal amount of funded debt, and (e) the outstanding
principal amount of all obligations
5
#2661-001
owing to GECC, DVI and USBPS; all as determined for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(vi) EBITDA MARGIN. The Company shall not permit the
EBITDA Margin to be less than 25% as of the end of any Fiscal Quarter ending on
or after April 30, 2005. "EBITDA MARGIN" means for any period, the ratio of (a)
EBITDA for such period, to (b) net revenues (excluding the professional service
fee component of radiology services) for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(vii) RECEIVABLE DAYS. The Company shall not permit
the Receivable Days to exceed 65 days as of the end of any Fiscal Quarter ending
on or after April 30, 2005. "RECEIVABLE DAYS" means for any period, a number
equal to (a) 365 divided by (b) the result of (i) net revenues for such period
divided by (ii) net receivables for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(viii) NAME CHANGES, ETC. The Company agrees that it
shall not change its name or jurisdiction of organization without giving 30 days
prior written notice to USBPS.
10. To induce USBPS on behalf of the Trustee to enter this
Agreement, the Guarantor hereby affirms and restates its Guarantee as related to
this Loan and AMENDED AND RESTATED RIDER A.
11. SoCal, the Company and the Guarantor each represent and
warrant that each has been represented by an attorney of its choice and is fully
aware of the terms contained in this Agreement and AMENDED AND RESTATED RIDER A
to which it is a party which was voluntarily entered into without coercion or
duress of any kind.
12. SoCal represents and warrants to USBPS on behalf of the
Noteholders and Trustee that all necessary actions on the part of SoCal to be
taken in connection with the execution, delivery and performance of this
Agreement have been taken; the performance by SoCal of this Agreement and the
AMENDED AND RESTATED RIDER A will not violate any of SoCal's
6
#2661-001
Articles of Incorporation, Articles of Formation, Partnership Agreement or other
agreement or law by which SoCal is bound.
13. Any notice, request, direction, consent, approval, waiver
or other communication required or permitted under this Agreement to be sent
must be in writing and will become effective only upon delivery to USBPS at the
address set forth herein as follows:
U.S. Bank Portfolio Services
0000 Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxx, XX 00000
Attn: Xxxx Xxx, Director of Operations
14. Except as provided herein, and in the AMENDED AND RESTATED
RIDER A, all of the other provisions of the Loan Documents not restated will
remain in effect.
15. This Agreement and the documents referenced herein
constitute the entire and final agreement among the parties with respect to the
subject matter hereof and there are no agreements, understandings, warranties or
representations among the parties with respect to these matters except as set
forth herein.
16. This Agreement will inure to the benefit of and bind the
parties and their respective successors and permitted assigns.
17. Neither this Agreement nor any of the provisions hereof
can be changed, waived, discharged or terminated except by an instrument in
writing signed by the parties against whom such enforcement of the change,
waiver, discharge or termination is sought.
18. This Agreement will be interpreted and construed under the
laws of the Commonwealth of Pennsylvania, regardless of the domicile of any
party and will be considered to have been made, executed and performed in
Pennsylvania.
7
#2661-001
19. THE UNDERSIGNED, AND SUBJECT TO THE PROVISIONS CONTAINED
HEREIN, USBPS FOR ITSELF AND AS AGENT FOR THE TRUSTEE, (A) AGREE TO SUBMIT FOR
THEMSELVES, IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT AND ANY
SCHEDULE OR FOR RECOGNITION AND ENFORCEMENT OF ANY JUDGMENT IN RESPECT HEREOF OR
THEREOF, TO THE EXCLUSIVE JURISDICTION OF THE COURTS OF THE COMONWEALTH OF
PENNSYLVANIA, THE COURTS OF THE UNITED STATES OF AMERICA FOR THE EASTERN
DISTRICT OF PENNSYLVANIA, AND APPELLATE COURTS FROM ANY THEREOF, (B) CONSENT
THAT ANY ACTION OR PROCEEDING SHALL BE BROUGHT IN SUCH COURTS, AND WAIVE ANY
OBJECTION THAT EACH MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH ACTION OR
PROCEEDING IN ANY SUCH COURT, (C) AGREE THAT SERVICE OF PROCESS OF ANY SUCH
ACTION OR PROCEEDING MAY BE EFFECTED BY CERTIFIED MAIL (OR ANY SUBSTANTIALLY
SIMILAR FORM OF MAIL), POSTAGE PREPAID, TO THE APPROPRIATE PARTY AT ITS ADDRESS
AS SET FORTH HEREIN, AND SERVICE MADE SHALL BE DEEMED TO BE COMPLETED UPON THE
EARLIER OF ACTUAL RECEIPT OR FIVE (5) DAYS AFTER THE SAME SHALL HAVE BEEN POSTED
AS AFORESAID, AND (D) AGREE THAT NOTHING HEREIN OR IN ANY EXHIBIT OR SCHEDULE
SHALL AFFECT THE RIGHT TO EFFECT SERVICE OF PROCESS IN ANY OTHER MANNER
PERMITTED BY LAW. USBPS AND THE UNDERSIGNED EACH HEREBY UNCONDITIONALLY WAIVES
ITS RIGHT TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING
OUT OF, DIRECTLY OR INDIRECTLY, THIS AGREEMENT, ANY EXHIBIT AND THE TRANSACTIONS
8
#2661-001
CONTEMPLATED HEREBY AND THEREBY, ANY OF THE RELATED DOCUMENTS, ANY DEALINGS
BETWEEN THE PARTIES HERETO RELATING TO THE SUBJECT MATTER HEREOF OR THEREOF,
AND/OR THE RELATIONSHIP THAT IS BEING ESTABLISHED BETWEEN USBPS AS AGENT FOR THE
TRUSTEE AND THE UNDERSIGNED, PROVIDED USBPS MAY IN ITS DISCRETION ENFORCE THE
TERMS OF THE FORUM SELECTION PROVISIONS IN THE LOANS.
20. SoCal, the Company and the Guarantor hereby release USBPS,
the Trustee, and the Noteholders from and against any claim, loss, or damage
arising out of the negotiation execution, and performance of the Loan or related
matters prior to the date hereof.
21. This Agreement may be executed in two or more counterparts
and each counterpart shall be deemed an original.
9
#2661-001
LYON FINANCIAL SERVICES, INC. DBA U.S.
BANK PORTFOLIO SERVICES, AS SUCCESSOR
SERVICER FOR DVI RECEIVABLES XII, L.L.C.
AND AS AGENT FOR U.S. BANK, N.A., AS TRUSTEE
By: ________________________________________
SOCAL MR SITE MANAGEMENT, INC.
By: ________________________________________
RADNET MANAGEMENT, INC.
By: ________________________________________
ACKNOWLEDGED AND AGREED TO:
Radnet Management, Inc., Guarantor
By: ______________________________
10
#1232-010
AMENDMENT TO LOAN DOCUMENTS
---------------------------
AGREEMENT made as of June 30, 2004 ("AMENDMENT AGREEMENT" or
"AGREEMENT") by and between LYON FINANCIAL SERVICES, INC. DBA U.S. BANK
PORTFOLIO SERVICES, as Successor Servicer for DVI Receivables XIX, L.L.C. and as
Agent for U.S. Bank, N.A., as Trustee, with offices at 0000 Xxxxxx Xxxxxx, Xxxxx
000, Xxxxxxxx, Xxxxxxxxx 00000 ("USBPS") and Radnet Sub, Inc., a corporation,
with offices at 0000 Xxxxxx Xxxxxx, Xxx Xxxxxxx, XX 00000 ("RADNET"), and such
other signatories hereto.
WHEREAS, on or about Xxxxx 00, 0000, Xxxxxx executed and
delivered to DVI Financial Services Inc. ("DVI") a Loan and Security Agreement
collectively with the Schedule Number #1232-010 dated September 19, 2001 (the
"LOAN")(the Loan, together with all ancillary documents are, collectively, the
"LOAN DOCUMENTS");
WHEREAS, to secure the payment of the Loan and all other
obligations of Radnet to DVI (collectively the "OBLIGATIONS"), Radnet, pursuant
to a Loan and Security Agreement dated on or about March 17, 1996 (the "SECURITY
AGREEMENT"), granted DVI a first priority security interest in certain
Collateral described therein;
WHEREAS, substantially contemporaneously therewith, DVI
contributed all of the Loan Documents to DVI Receivables XIX, L.L.C. ("DVI XIX")
and thereafter pursuant to an Amended and Restated Indenture, DVI XIX granted a
first priority security interest in and pledged all of the Loan Documents in
favor of U.S. Bank, N.A., as Trustee, for the benefit of a noteholder which
purchased asset backed promissory notes issued by DVI XIX (the "Noteholder");
WHEREAS, DVI contributed other Loans with Radnet or certain
affiliates of Radnet to this and other DVI securitizations (collectively the
"RELATED LOANS");
#1232-010
WHEREAS, Radnet is in default under the terms of the Loan;
WHEREAS, Radnet has requested USBPS to modify the Loan to
reflect an adjustment in payments;
WHEREAS, Radnet and/or certain of its affiliates have agreed
to modify the Related Loans;
WHEREAS, Radnet and certain of its affiliates are engaged in
negotiations to restructure or modify certain loan agreements, loans and
promissory notes with each of General Electric Capital Corporation ("GECC") and
DVI (with respect to GECC, the "GECC MODIFICATION", and with respect to DVI, the
"DVI MODIFICATION");
WHEREAS, subject to the following terms and conditions, USBPS
is willing to modify the Loan as hereinafter provided.
NOW, THEREFORE, the parties agree as follows:
1. All of the Whereas clauses are incorporated herein as if
hereinafter set forth at full length.
2. Radnet acknowledges that it is duly indebted to the Trustee
in the sum set forth on AMENDED AND RESTATED RIDER A annexed hereto, and has no
defenses, counterclaims or offsets to such indebtedness.
3. USBPS as Agent for the Trustee will modify the Loan to
provide for payments to commence in accordance with the attached revised payment
schedule (the "AMENDED AND RESTATED RIDER A"). Radnet may, at any time, prepay
all of the outstanding Obligations subject to an additional prepayment fee of 2%
of such Obligations. Partial prepayments of the Obligations shall not be
permitted at any time.
2
4. This Agreement shall become effective upon the date that
USBPS receives this Agreement duly executed by Radnet and the satisfaction of
each of the following conditions:
(a) Radnet and/or its affiliates shall have entered
into agreements on similar terms to this Agreement and
otherwise in form and substance satisfactory to USBPS,
relating to the Related Loans (the "Related Loan
Modifications");
(b) reimbursement of USBPS's legal fees incurred in
connection with the execution of this Agreement and the
Related Loan Modifications, aggregating $50,000, shall have
been received by USBPS;
(c) Radnet and/or its affiliates shall have entered
into the GECC Modification and the DVI Modification.
5. The closing of the restructuring of the Radnet Loan is
further subject to delivery to USBPS of all of the following, each in form and
substance satisfactory to USBPS and its counsel:
(a) The executed AMENDED AND RESTATED RIDER A;
(b) An executed copy of this Agreement;
(c) Such other documents, including UCC financing
statements as USBPS reasonably requests.
6. Radnet hereby acknowledges and agrees that it has no, and
will not assert any, defenses, counterclaims or offsets to the Loan and AMENDED
AND RESTATED RIDER A and acknowledges and agrees that the Trustee holds a
first-priority security interest in the Collateral.
7. Any default or other breach of any obligation under the
GECC Modification, the DVI Modification, or any of the Related Loan
Modifications shall constitute a default under the Loan as modified by this
Agreement, and USBPS shall have all remedies thereunder.
3
8. Radnet hereby releases the Noteholder, USBPS individually
and as agent for the Trustee and the special purpose entities for which the
Trustee holds collateral, from and against any claims, loss or damage of any
kind or nature arising out of the Loan.
9. So long as any of the Obligations remain outstanding,
Radnet Management, Inc. (the "COMPANY") agrees as follows:
(i) FINANCIAL REPORTING. The Company shall furnish
the following documents or information to USBPS:
(A) Within 30 days after the end of each
Fiscal Quarter (as defined below) (i) (or 90 days in respect of the last month
of the fiscal year), the Company's consolidated, consolidating and on a center
by center basis, financial statements, including the most recent annual report,
balance sheet (not on a center by center basis) and income statement, prepared
in accordance with generally accepted accounting principles, which reports, the
Company warrants, shall fully and fairly represent the true financial condition
of the Company and (ii) updated projections for the Company and for each center;
(B) any other financial information normally
provided by the Company to the public;
and
(C) Such other financial data or information
relative to this Amendment Agreement, including, without limitation, listings of
serial numbers or other identification data and confirmations of such
information, as USBPS may time-to-time reasonably request.
(ii) NO AMENDMENTS. Subsequent to the date of this
Amendment Agreement, the Company will not agree or consent to any amendments or
modifications to any agreement between the Company and DVI, GECC or Xxxxx Fargo
Foothill, Inc. ("FOOTHILL") containing terms (including, but not limited to,
increasing interest rates, accelerating the principal amortization or maturity,
new or more stringent defaults, additional collateral, and new remedies
provisions) that would be more onerous to the Company, or adversely impact or
affect GECC with respect to the terms of this Amendment Agreement.
(iii) DISTRIBUTIONS. The Company shall not make any
distribution or declare or pay any dividends (in cash or other property, other
than common stock) on, or purchase, acquire, redeem, or retire any of the
Company's stock, of any class, whether now or hereafter outstanding
(collectively, "DISTRIBUTIONS"); PROVIDED, HOWEVER, that so long as no default
shall have occurred and be continuing immediately prior to or after giving
effect to any such payment, (a) the Company may make Distributions to Primedex
Health Systems, Inc., a New York corporation (the "PARENT") (1) in amounts
necessary to pay customary expenses of Parent in the ordinary course of its
business as a public holding company (including salaries and
4
#1232-010
related reasonable and customary expenses incurred by employees of Parent) in an
aggregate amount not to exceed $750,000 in any fiscal year, (2) in amounts
necessary to enable Parent to pay taxes when due and owing by it in the ordinary
course of its business as a holding company and (3) in amounts necessary to
enable Parent to pay interest on those certain 11.5% Series A Convertible
Subordinated Notes due June 30, 2008, issued by Parent on June 25, 1993, and (b)
Parent may make Distributions in the form of common stock.
(iv) FIXED CHARGE COVERAGE RATIO. Commencing April
30, 2005, the Company shall not permit the Fixed Charge Coverage Ratio, (a) to
be less than 1.0:1 as of the end of each April, July, October and January (each,
a "FISCAL QUARTER") ending prior to January 1, 2007, and (b) to be less than
1.05:1 as of the last day of each Fiscal Quarter ending thereafter. "FIXED
CHARGE COVERAGE RATIO" means for any period, the ratio of (i) EBITDA for such
period MINUS cash capital expenditures made (to the extent not already incurred
in a prior period) or incurred during such period, to (ii) the sum of (a)
interest expense, (b) principal payments required to be paid during such period
in respect of indebtedness, and (c) all federal, state, and local income taxes
accrued, all as determined for the twelve months ending on the determination
date for the Company and its subsidiaries on a consolidated basis without
duplication and in accordance with generally accepted accounting principles
consistently applied. "EBITDA" means, with respect to any fiscal period, the
Company's and its subsidiaries' consolidated net earnings (or loss), minus
extraordinary gains and interest income, plus interest expense, income taxes,
and depreciation and amortization for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(v) LEVERAGE RATIO. The Company shall not permit the
Leverage Ratio, as determined as of the end of each Fiscal Quarter, to be
greater than the amount set forth in the following table for the Fiscal Quarters
ending in the period set forth opposite thereto:
LEVERAGE RATIO PERIOD
-------------- ------
4.50:1.0 04/30/05 - 10/30/05
4.30:1.0 10/31/05 - 10/30/06
4.00:1.0 10/31/06 - 10/30/07
3.80:1.0 10/31/07 - 10/30/08
"LEVERAGE RATIO" means, at any date of determination, the
ratio of (a) Total Debt at such date to (b) EBITDA for the applicable period
ending on such date. "TOTAL DEBT" means, as of any date of determination,
without duplication, the sum of (a) the outstanding aggregate amount of the
obligations for borrowed money, (b) the outstanding principal amount of capital
leases, (c) the outstanding principal amount of purchase money indebtedness, (d)
the outstanding principal amount of funded debt, and (e) the outstanding
principal amount of all obligations owing to GECC, DVI and USBPS; all as
determined for the Company and its subsidiaries on a consolidated basis without
duplication and in accordance with generally accepted accounting principles
consistently applied.
5
#1232-010
(vi) EBITDA MARGIN. The Company shall not permit the
EBITDA Margin to be less than 25% as of the end of any Fiscal Quarter ending on
or after April 30, 2005. "EBITDA MARGIN" means for any period, the ratio of (a)
EBITDA for such period, to (b) net revenues (excluding the professional service
fee component of radiology services) for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(vii) RECEIVABLE DAYS. The Company shall not permit
the Receivable Days to exceed 65 days as of the end of any Fiscal Quarter ending
on or after April 30, 2005. "RECEIVABLE DAYS" means for any period, a number
equal to (a) 365 divided by (b) the result of (i) net revenues for such period
divided by (ii) net receivables for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(viii) NAME CHANGES, ETC. The Company agrees that it
shall not change its name or jurisdiction of organization without giving 30 days
prior written notice to USBPS.
10. This paragraph is intentionally left blank.
11. Radnet and the Company each represent and warrant that it
has been represented by an attorney of its choice and is fully aware of the
terms contained in this Agreement and AMENDED AND RESTATED RIDER A to which it
is a party which was voluntarily entered into without coercion or duress of any
kind.
12. Radnet represents and warrants to USBPS on behalf of the
Noteholders and Trustee that all necessary actions on the part of Radnet to be
taken in connection with the execution, delivery and performance of this
Agreement have been taken; the performance by Radnet of this Agreement and the
AMENDED AND RESTATED RIDER A will not violate any of Radnet's Articles of
Incorporation, Articles of Formation, Partnership Agreement or other agreement
or law by which Radnet is bound.
13. Any notice, request, direction, consent, approval, waiver
or other communication required or permitted under this Agreement to be sent
must be in writing and will become effective only upon delivery to USBPS at the
address set forth herein as follows:
6
#1232-010
U.S. Bank Portfolio Services
0000 Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxx, XX 00000
Attn: Xxxx Xxx, Director of Operations
14. Except as provided herein, and in the AMENDED AND RESTATED
RIDER A, all of the other provisions of the Loan Documents not restated will
remain in effect.
15. This Agreement and the documents referenced herein
constitute the entire and final agreement among the parties with respect to the
subject matter hereof and there are no agreements, understandings, warranties or
representations among the parties with respect to these matters except as set
forth herein.
16. This Agreement will inure to the benefit of and bind the
parties and their respective successors and permitted assigns.
17. Neither this Agreement nor any of the provisions hereof
can be changed, waived, discharged or terminated except by an instrument in
writing signed by the parties against whom such enforcement of the change,
waiver, discharge or termination is sought.
18. This Agreement will be interpreted and construed under the
laws of the Commonwealth of Pennsylvania, regardless of the domicile of any
party and will be considered to have been made, executed and performed in
Pennsylvania.
19. THE UNDERSIGNED, AND SUBJECT TO THE PROVISIONS CONTAINED
HEREIN, USBPS FOR ITSELF AND AS AGENT FOR THE TRUSTEE, (A) AGREE TO SUBMIT FOR
THEMSELVES, IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT AND ANY
SCHEDULE OR FOR RECOGNITION AND ENFORCEMENT OF ANY JUDGMENT IN RESPECT HEREOF OR
THEREOF, TO THE EXCLUSIVE JURISDICTION OF THE COURTS OF THE BRMFS1 509512v2
7
#1232-010
COMONWEALTH OF PENNSYLVANIA, XXX XXXXXX XX XXX XXXXXX XXXXXX XX XXXXXXX FOR THE
EASTERN DISTRICT OF PENNSYLVANIA, AND APPELLATE COURTS FROM ANY THEREOF, (B)
CONSENT THAT ANY ACTION OR PROCEEDING SHALL BE BROUGHT IN SUCH COURTS, AND WAIVE
ANY OBJECTION THAT EACH MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH
ACTION OR PROCEEDING IN ANY SUCH COURT, (C) AGREE THAT SERVICE OF PROCESS OF ANY
SUCH ACTION OR PROCEEDING MAY BE EFFECTED BY CERTIFIED MAIL (OR ANY
SUBSTANTIALLY SIMILAR FORM OF MAIL), POSTAGE PREPAID, TO THE APPROPRIATE PARTY
AT ITS ADDRESS AS SET FORTH HEREIN, AND SERVICE MADE SHALL BE DEEMED TO BE
COMPLETED UPON THE EARLIER OF ACTUAL RECEIPT OR FIVE (5) DAYS AFTER THE SAME
SHALL HAVE BEEN POSTED AS AFORESAID, AND (D) AGREE THAT NOTHING HEREIN OR IN ANY
EXHIBIT OR SCHEDULE SHALL AFFECT THE RIGHT TO EFFECT SERVICE OF PROCESS IN ANY
OTHER MANNER PERMITTED BY LAW. USBPS AND THE UNDERSIGNED EACH HEREBY
UNCONDITIONALLY WAIVES ITS RIGHT TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION
BASED UPON OR ARISING OUT OF, DIRECTLY OR INDIRECTLY, THIS AGREEMENT, ANY
EXHIBIT AND THE TRANSACTIONS CONTEMPLATED HEREBY AND THEREBY, ANY OF THE RELATED
DOCUMENTS, ANY DEALINGS BETWEEN THE PARTIES HERETO RELATING TO THE SUBJECT
MATTER HEREOF OR THEREOF, AND/OR THE RELATIONSHIP THAT IS BEING ESTABLISHED
BETWEEN USBPS AS AGENT FOR THE TRUSTEE AND THE UNDERSIGNED, PROVIDED USBPS MAY
IN ITS DISCRETION ENFORCE THE TERMS OF THE FORUM SELECTION PROVISIONS IN THE
LOANS.
8
20. Radnet and the Company hereby release USBPS, the Trustee,
and the Noteholders from and against any claim, loss, or damage arising out of
the negotiation execution, and performance of the Loan or related matters prior
to the date hereof.
21. This Agreement may be executed in two or more counterparts
and each counterpart shall be deemed an original.
LYON FINANCIAL SERVICES, INC. DBA U.S.
BANK PORTFOLIO SERVICES, AS SUCCESSOR
SERVICER FOR DVI RECEIVABLES XIX, L.L.C.
AND AS AGENT FOR U.S. BANK, N.A., AS TRUSTEE
By: ________________________________________
RADNET SUB, INC.
By: ________________________________________
RADNET MANAGEMENT, INC.
By: ________________________________________
9
#0873-011
AMENDMENT TO LOAN DOCUMENTS
---------------------------
AGREEMENT made as of June 30, 2004 ("AMENDMENT AGREEMENT" or
"AGREEMENT") by and between LYON FINANCIAL SERVICES, INC. DBA U.S. BANK
PORTFOLIO SERVICES, as Successor Servicer for DVI Receivables XVI, L.L.C. and as
Agent for U.S. Bank, N.A., as Trustee, with offices at 0000 Xxxxxx Xxxxxx, Xxxxx
000, Xxxxxxxx, Xxxxxxxxx 00000 ("USBPS") and Diagnostic Imaging Services, Inc.
I, a corporation, with offices at 0000 Xxxxxx Xxxxxx, Xxx Xxxxxxx, XX 00000
("DIS"), and such other signatories hereto.
WHEREAS, on or about March 30, 1995, DIS executed and
delivered to DVI Financial Services Inc. ("DVI") a Loan and Security Agreement
collectively with the Schedule Number #0873-011 dated November 27, 2000 (the
"LOAN")(the Loan, together with all ancillary documents are, collectively, the
"LOAN DOCUMENTS");
WHEREAS, to secure the payment of the Loan and all other
obligations of DIS to DVI (collectively the "OBLIGATIONS"), DIS, pursuant to a
Loan and Security Agreement dated on or about March 30, 1995 (the "SECURITY
AGREEMENT"), granted DVI a first priority security interest in certain
Collateral described therein;
WHEREAS, substantially contemporaneously therewith, DVI
contributed all of the Loan Documents to DVI Receivables XVI, L.L.C. ("DVI XVI")
and thereafter pursuant to an Amended and Restated Indenture, DVI XVI granted a
first priority security interest in and pledged all of the Loan Documents in
favor of U.S. Bank, N.A., as Trustee, for the benefit of a noteholder which
purchased asset backed promissory notes issued by DVI XVI (the "Noteholder");
#0873-011
WHEREAS, DVI contributed other Loans with DIS or certain
affiliates of DIS to this and other DVI securitizations (collectively the
"RELATED LOANS");
WHEREAS, DIS is in default under the terms of the Loan;
WHEREAS, DIS has requested USBPS to modify the Loan to reflect
an adjustment in payments;
WHEREAS, DIS and/or certain of its affiliates have agreed to
modify the Related Loans;
WHEREAS, DIS and certain of its affiliates are engaged in
negotiations to restructure or modify certain loan agreements, loans and
promissory notes with each of General Electric Capital Corporation ("GECC") and
DVI (with respect to GECC, the "GECC MODIFICATION", and with respect to DVI, the
"DVI MODIFICATION");
WHEREAS, subject to the following terms and conditions, USBPS
is willing to modify the Loan as hereinafter provided.
NOW, THEREFORE, the parties agree as follows:
1. All of the Whereas clauses are incorporated herein as if
hereinafter set forth at full length.
2. DIS acknowledges that it is duly indebted to the Trustee in
the sum set forth on AMENDED AND RESTATED RIDER A annexed hereto, and has no
defenses, counterclaims or offsets to such indebtedness.
3. USBPS as Agent for the Trustee will modify the Loan to
provide for payments to commence in accordance with the attached revised payment
schedule (the "AMENDED AND RESTATED RIDER A"). DIS may, at any time, prepay all
of the outstanding
2
#0873-011
Obligations subject to an additional prepayment fee of 2% of such Obligations.
Partial prepayments of the Obligations shall not be permitted at any time.
4. This Agreement shall become effective upon the date that
USBPS receives this Agreement duly executed by DIS and the satisfaction of each
of the following conditions:
(a) DIS and/or its affiliates shall have entered into
agreements on similar terms to this Agreement and otherwise in
form and substance satisfactory to USBPS, relating to the
Related Loans (the "Related Loan Modifications");
(b) reimbursement of USBPS's legal fees incurred in
connection with the execution of this Agreement and the
Related Loan Modifications, aggregating $50,000, shall have
been received by USBPS;
(c) DIS and/or its affiliates shall have entered into
the GECC Modification and the DVI Modification.
5. The closing of the restructuring of the DIS Loan is further
subject to delivery to USBPS of all of the following, each in form and substance
satisfactory to USBPS and its counsel:
(a) The executed AMENDED AND RESTATED RIDER A;
(b) An executed copy of this Agreement;
(c) Such other documents, including UCC financing
statements as USBPS reasonably requests.
6. DIS hereby acknowledges and agrees that it has no, and will
not assert any, defenses, counterclaims or offsets to the Loan and AMENDED AND
RESTATED RIDER A and acknowledges and agrees that the Trustee holds a
first-priority security interest in the Collateral.
7. Any default or other breach of any obligation under the
GECC Modification, the DVI Modification, or any of the Related Loan
Modifications shall constitute a
3
#0873-011
default under the Loan as modified by this Agreement, and USBPS shall have all
remedies thereunder.
8. DIS hereby releases the Noteholder, USBPS individually and
as agent for the Trustee and the special purpose entities for which the Trustee
holds collateral, from and against any claims, loss or damage of any kind or
nature arising out of the Loan.
9. So long as any of the Obligations remain outstanding,
Radnet Management, Inc. (the "COMPANY") agrees as follows:
(i) FINANCIAL REPORTING. The Company shall furnish
the following documents or information to USBPS:
(A) Within 30 days after the end of each
Fiscal Quarter (as defined below) (i) (or 90 days in respect of the last month
of the fiscal year), the Company's consolidated, consolidating and on a center
by center basis, financial statements, including the most recent annual report,
balance sheet (not on a center by center basis) and income statement, prepared
in accordance with generally accepted accounting principles, which reports, the
Company warrants, shall fully and fairly represent the true financial condition
of the Company and (ii) updated projections for the Company and for each center;
(B) any other financial information normally
provided by the Company to the public; and
(C) Such other financial data or information
relative to this Amendment Agreement, including, without limitation, listings of
serial numbers or other identification data and confirmations of such
information, as USBPS may time-to-time reasonably request.
(ii) NO AMENDMENTS. Subsequent to the date of this
Amendment Agreement, the Company will not agree or consent to any amendments or
modifications to any agreement between the Company and DVI, GECC or Xxxxx Fargo
Foothill, Inc. ("FOOTHILL") containing terms (including, but not limited to,
increasing interest rates, accelerating the principal amortization or maturity,
new or more stringent defaults, additional collateral, and new remedies
provisions) that would be more onerous to the Company, or adversely impact or
affect GECC with respect to the terms of this Amendment Agreement.
(iii) DISTRIBUTIONS. The Company shall not make any
distribution or declare or pay any dividends (in cash or other property, other
than common stock) on, or purchase, acquire, redeem, or retire any of the
Company's stock, of any class, whether now or hereafter outstanding
(collectively, "DISTRIBUTIONS"); PROVIDED, HOWEVER, that so long as no
4
#0873-011
default shall have occurred and be continuing immediately prior to or after
giving effect to any such payment, (a) the Company may make Distributions to
Primedex Health Systems, Inc., a New York corporation (the "PARENT") (1) in
amounts necessary to pay customary expenses of Parent in the ordinary course of
its business as a public holding company (including salaries and related
reasonable and customary expenses incurred by employees of Parent) in an
aggregate amount not to exceed $750,000 in any fiscal year, (2) in amounts
necessary to enable Parent to pay taxes when due and owing by it in the ordinary
course of its business as a holding company and (3) in amounts necessary to
enable Parent to pay interest on those certain 11.5% Series A Convertible
Subordinated Notes due June 30, 2008, issued by Parent on June 25, 1993, and (b)
Parent may make Distributions in the form of common stock.
(iv) FIXED CHARGE COVERAGE RATIO. Commencing April
30, 2005, the Company shall not permit the Fixed Charge Coverage Ratio, (a) to
be less than 1.0:1 as of the end of each April, July, October and January (each,
a "FISCAL QUARTER") ending prior to January 1, 2007, and (b) to be less than
1.05:1 as of the last day of each Fiscal Quarter ending thereafter. "FIXED
CHARGE COVERAGE RATIO" means for any period, the ratio of (i) EBITDA for such
period MINUS cash capital expenditures made (to the extent not already incurred
in a prior period) or incurred during such period, to (ii) the sum of (a)
interest expense, (b) principal payments required to be paid during such period
in respect of indebtedness, and (c) all federal, state, and local income taxes
accrued, all as determined for the twelve months ending on the determination
date for the Company and its subsidiaries on a consolidated basis without
duplication and in accordance with generally accepted accounting principles
consistently applied. "EBITDA" means, with respect to any fiscal period, the
Company's and its subsidiaries' consolidated net earnings (or loss), minus
extraordinary gains and interest income, plus interest expense, income taxes,
and depreciation and amortization for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(v) LEVERAGE RATIO. The Company shall not permit the
Leverage Ratio, as determined as of the end of each Fiscal Quarter, to be
greater than the amount set forth in the following table for the Fiscal Quarters
ending in the period set forth opposite thereto:
LEVERAGE RATIO PERIOD
-------------- ------
4.50:1.0 04/30/05 - 10/30/05
4.30:1.0 10/31/05 - 10/30/06
4.00:1.0 10/31/06 - 10/30/07
3.80:1.0 10/31/07 - 10/30/08
"LEVERAGE RATIO" means, at any date of determination, the
ratio of (a) Total Debt at such date to (b) EBITDA for the applicable period
ending on such date. "TOTAL DEBT" means, as of any date of determination,
without duplication, the sum of (a) the outstanding aggregate amount of the
obligations for borrowed money, (b) the outstanding principal amount of capital
leases, (c) the outstanding principal amount of purchase money indebtedness, (d)
the outstanding principal amount of funded debt, and (e) the outstanding
principal amount of all obligations
5
#0873-011
owing to GECC, DVI and USBPS; all as determined for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(vi) EBITDA MARGIN. The Company shall not permit the
EBITDA Margin to be less than 25% as of the end of any Fiscal Quarter ending on
or after April 30, 2005. "EBITDA MARGIN" means for any period, the ratio of (a)
EBITDA for such period, to (b) net revenues (excluding the professional service
fee component of radiology services) for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(vii) RECEIVABLE DAYS. The Company shall not permit
the Receivable Days to exceed 65 days as of the end of any Fiscal Quarter ending
on or after April 30, 2005. "RECEIVABLE DAYS" means for any period, a number
equal to (a) 365 divided by (b) the result of (i) net revenues for such period
divided by (ii) net receivables for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(viii) NAME CHANGES, ETC. The Company agrees that it
shall not change its name or jurisdiction of organization without giving 30 days
prior written notice to USBPS.
10. This paragraph is intentionally left blank.
11. DIS and the Company each represent and warrant that it has
been represented by an attorney of its choice and is fully aware of the terms
contained in this Agreement and AMENDED AND RESTATED RIDER A to which it is a
party which was voluntarily entered into without coercion or duress of any kind.
12. DIS represents and warrants to USBPS on behalf of the
Noteholders and Trustee that all necessary actions on the part of DIS to be
taken in connection with the execution, delivery and performance of this
Agreement have been taken; the performance by DIS of this Agreement and the
AMENDED AND RESTATED RIDER A will not violate any of DIS's Articles of
Incorporation, Articles of Formation, Partnership Agreement or other agreement
or law by which DIS is bound.
6
13. Any notice, request, direction, consent, approval, waiver
or other communication required or permitted under this Agreement to be sent
must be in writing and will become effective only upon delivery to USBPS at the
address set forth herein as follows:
U.S. Bank Portfolio Services
0000 Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxx, XX 00000
Attn: Xxxx Xxx, Director of Operations
14. Except as provided herein, and in the AMENDED AND RESTATED
RIDER A, all of the other provisions of the Loan Documents not restated will
remain in effect.
15. This Agreement and the documents referenced herein
constitute the entire and final agreement among the parties with respect to the
subject matter hereof and there are no agreements, understandings, warranties or
representations among the parties with respect to these matters except as set
forth herein.
16. This Agreement will inure to the benefit of and bind the
parties and their respective successors and permitted assigns.
17. Neither this Agreement nor any of the provisions hereof
can be changed, waived, discharged or terminated except by an instrument in
writing signed by the parties against whom such enforcement of the change,
waiver, discharge or termination is sought.
18. This Agreement will be interpreted and construed under the
laws of the Commonwealth of Pennsylvania, regardless of the domicile of any
party and will be considered to have been made, executed and performed in
Pennsylvania.
19. THE UNDERSIGNED, AND SUBJECT TO THE PROVISIONS CONTAINED
HEREIN, USBPS FOR ITSELF AND AS AGENT FOR THE TRUSTEE, (A) AGREE TO SUBMIT FOR
THEMSELVES, IN ANY LEGAL ACTION OR
7
#0873-011
PROCEEDING RELATING TO THIS AGREEMENT AND ANY SCHEDULE OR FOR RECOGNITION AND
ENFORCEMENT OF ANY JUDGMENT IN RESPECT HEREOF OR THEREOF, TO THE EXCLUSIVE
JURISDICTION OF THE COURTS OF THE COMONWEALTH OF PENNSYLVANIA, THE COURTS OF THE
UNITED STATES OF AMERICA FOR THE EASTERN DISTRICT OF PENNSYLVANIA, AND APPELLATE
COURTS FROM ANY THEREOF, (B) CONSENT THAT ANY ACTION OR PROCEEDING SHALL BE
BROUGHT IN SUCH COURTS, AND WAIVE ANY OBJECTION THAT EACH MAY NOW OR HEREAFTER
HAVE TO THE VENUE OF ANY SUCH ACTION OR PROCEEDING IN ANY SUCH COURT, (C) AGREE
THAT SERVICE OF PROCESS OF ANY SUCH ACTION OR PROCEEDING MAY BE EFFECTED BY
CERTIFIED MAIL (OR ANY SUBSTANTIALLY SIMILAR FORM OF MAIL), POSTAGE PREPAID, TO
THE APPROPRIATE PARTY AT ITS ADDRESS AS SET FORTH HEREIN, AND SERVICE MADE SHALL
BE DEEMED TO BE COMPLETED UPON THE EARLIER OF ACTUAL RECEIPT OR FIVE (5) DAYS
AFTER THE SAME SHALL HAVE BEEN POSTED AS AFORESAID, AND (D) AGREE THAT NOTHING
HEREIN OR IN ANY EXHIBIT OR SCHEDULE SHALL AFFECT THE RIGHT TO EFFECT SERVICE OF
PROCESS IN ANY OTHER MANNER PERMITTED BY LAW. USBPS AND THE UNDERSIGNED EACH
HEREBY UNCONDITIONALLY WAIVES ITS RIGHT TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF
ACTION BASED UPON OR ARISING OUT OF, DIRECTLY OR INDIRECTLY, THIS AGREEMENT, ANY
EXHIBIT AND THE TRANSACTIONS CONTEMPLATED HEREBY AND THEREBY, ANY OF THE RELATED
DOCUMENTS, ANY DEALINGS BETWEEN THE PARTIES HERETO RELATING TO THE SUBJECT
MATTER HEREOF OR THEREOF, AND/OR THE RELATIONSHIP THAT IS BEING
8
#0873-011
ESTABLISHED BETWEEN USBPS AS AGENT FOR THE TRUSTEE AND THE UNDERSIGNED, PROVIDED
USBPS MAY IN ITS DISCRETION ENFORCE THE TERMS OF THE FORUM SELECTION PROVISIONS
IN THE LOANS.
20. DIS and the Company hereby release USBPS, the Trustee, and
the Noteholders from and against any claim, loss, or damage arising out of the
negotiation execution, and performance of the Loan or related matters prior to
the date hereof.
21. This Agreement may be executed in two or more counterparts
and each counterpart shall be deemed an original.
LYON FINANCIAL SERVICES, INC. DBA U.S.
BANK PORTFOLIO SERVICES, AS SUCCESSOR
SERVICER FOR DVI RECEIVABLES XVI, L.L.C.
AND AS AGENT FOR U.S. BANK, N.A., AS TRUSTEE
By: ________________________________________
DIAGNOSTIC IMAGING SERVICES, INC. I
By: ________________________________________
By: ________________________________________
RADNET MANAGEMENT, INC.
By: ________________________________________
9
#0873-007
AMENDMENT TO LOAN DOCUMENTS
---------------------------
AGREEMENT made as of June 30, 2004 ("AMENDMENT AGREEMENT" or
"AGREEMENT") by and between LYON FINANCIAL SERVICES, INC. DBA U.S. BANK
PORTFOLIO SERVICES, as Successor Servicer for DVI Receivables VIII, L.L.C. and
as Agent for U.S. Bank, N.A., as Trustee, with offices at 0000 Xxxxxx Xxxxxx,
Xxxxx 000, Xxxxxxxx, Xxxxxxxxx 00000 ("USBPS") and Diagnostic Imaging Services,
Inc. I, a corporation, with offices at 0000 Xxxxxx Xxxxxx, Xxx Xxxxxxx, XX 00000
("DIS"), and such other signatories hereto.
WHEREAS, on or about March 30, 1995, DIS executed and
delivered to DVI Financial Services Inc. ("DVI") a Loan and Security Agreement
collectively with the Schedule Number #0873-007 dated August 31, 1998 (the
"LOAN")(the Loan, together with all ancillary documents are, collectively, the
"LOAN DOCUMENTS");
WHEREAS, to secure the payment of the Loan and all other
obligations of DIS to DVI (collectively the "OBLIGATIONS"), DIS, pursuant to a
Loan and Security Agreement dated on or about March 30, 1995 (the "SECURITY
AGREEMENT"), granted DVI a first priority security interest in certain
Collateral described therein;
WHEREAS, substantially contemporaneously therewith, DVI
contributed all of the Loan Documents to DVI Receivables VIII, L.L.C. ("DVI
VIII") and thereafter pursuant to an Amended and Restated Indenture, DVI VIII
granted a first priority security interest in and pledged all of the Loan
Documents in favor of U.S. Bank, N.A., as Trustee, for the benefit of a
noteholder which purchased asset backed promissory notes issued by DVI VIII (the
"Noteholder");
#0873-007
WHEREAS, DVI contributed other Loans with DIS or certain
affiliates of DIS to this and other DVI securitizations (collectively the
"RELATED LOANS");
WHEREAS, DIS is in default under the terms of the Loan;
WHEREAS, DIS has requested USBPS to modify the Loan to reflect
an adjustment in payments;
WHEREAS, DIS and/or certain of its affiliates have agreed to
modify the Related Loans;
WHEREAS, DIS and certain of its affiliates are engaged in
negotiations to restructure or modify certain loan agreements, loans and
promissory notes with each of General Electric Capital Corporation ("GECC") and
DVI (with respect to GECC, the "GECC MODIFICATION", and with respect to DVI, the
"DVI MODIFICATION");
WHEREAS, subject to the following terms and conditions, USBPS
is willing to modify the Loan as hereinafter provided.
NOW, THEREFORE, the parties agree as follows:
1. All of the Whereas clauses are incorporated herein as if
hereinafter set forth at full length.
2. DIS acknowledges that it is duly indebted to the Trustee in
the sum set forth on AMENDED AND RESTATED RIDER A annexed hereto, and has no
defenses, counterclaims or offsets to such indebtedness.
3. USBPS as Agent for the Trustee will modify the Loan to
provide for payments to commence in accordance with the attached revised payment
schedule (the "AMENDED AND RESTATED RIDER A"). DIS may, at any time, prepay all
of the outstanding
2
#0873-007
Obligations subject to an additional prepayment fee of 2% of such Obligations.
Partial prepayments of the Obligations shall not be permitted at any time.
4. This Agreement shall become effective upon the date that
USBPS receives this Agreement duly executed by DIS and the satisfaction of each
of the following conditions:
(a) DIS and/or its affiliates shall have entered into
agreements on similar terms to this Agreement and otherwise in
form and substance satisfactory to USBPS, relating to the
Related Loans (the "Related Loan Modifications");
(b) reimbursement of USBPS's legal fees incurred in
connection with the execution of this Agreement and the
Related Loan Modifications, aggregating $50,000, shall have
been received by USBPS;
(c) DIS and/or its affiliates shall have entered into
the GECC Modification and the DVI Modification.
5. The closing of the restructuring of the DIS Loan is further
subject to delivery to USBPS of all of the following, each in form and substance
satisfactory to USBPS and its counsel:
(a) The executed AMENDED AND RESTATED RIDER A;
(b) An executed copy of this Agreement;
(c) Such other documents, including UCC financing
statements as USBPS reasonably requests.
6. DIS hereby acknowledges and agrees that it has no, and will
not assert any, defenses, counterclaims or offsets to the Loan and AMENDED AND
RESTATED RIDER A and acknowledges and agrees that the Trustee holds a
first-priority security interest in the Collateral.
7. Any default or other breach of any obligation under the
GECC Modification, the DVI Modification, or any of the Related Loan
Modifications shall constitute a
3
#0873-007
default under the Loan as modified by this Agreement, and USBPS shall have all
remedies thereunder.
8. DIS hereby releases the Noteholder, USBPS individually and
as agent for the Trustee and the special purpose entities for which the Trustee
holds collateral, from and against any claims, loss or damage of any kind or
nature arising out of the Loan.
9. So long as any of the Obligations remain outstanding,
Radnet Management, Inc. (the "COMPANY") agrees as follows:
(i) FINANCIAL REPORTING. The Company shall furnish
the following documents or information to USBPS:
(A) Within 30 days after the end of each
Fiscal Quarter (as defined below) (i) (or 90 days in respect of the last month
of the fiscal year), the Company's consolidated, consolidating and on a center
by center basis, financial statements, including the most recent annual report,
balance sheet (not on a center by center basis) and income statement, prepared
in accordance with generally accepted accounting principles, which reports, the
Company warrants, shall fully and fairly represent the true financial condition
of the Company and (ii) updated projections for the Company and for each center;
(B) any other financial information normally
provided by the Company to the public; and
(C) Such other financial data or information
relative to this Amendment Agreement, including, without limitation, listings of
serial numbers or other identification data and confirmations of such
information, as USBPS may time-to-time reasonably request.
(ii) NO AMENDMENTS. Subsequent to the date of this
Amendment Agreement, the Company will not agree or consent to any amendments or
modifications to any agreement between the Company and DVI, GECC or Xxxxx Fargo
Foothill, Inc. ("FOOTHILL") containing terms (including, but not limited to,
increasing interest rates, accelerating the principal amortization or maturity,
new or more stringent defaults, additional collateral, and new remedies
provisions) that would be more onerous to the Company, or adversely impact or
affect GECC with respect to the terms of this Amendment Agreement.
(iii) DISTRIBUTIONS. The Company shall not make any
distribution or declare or pay any dividends (in cash or other property, other
than common stock) on, or purchase, acquire, redeem, or retire any of the
Company's stock, of any class, whether now or hereafter outstanding
(collectively, "DISTRIBUTIONS"); PROVIDED, HOWEVER, that so long as no
4
#0873-007
default shall have occurred and be continuing immediately prior to or after
giving effect to any such payment, (a) the Company may make Distributions to
Primedex Health Systems, Inc., a New York corporation (the "PARENT") (1) in
amounts necessary to pay customary expenses of Parent in the ordinary course of
its business as a public holding company (including salaries and related
reasonable and customary expenses incurred by employees of Parent) in an
aggregate amount not to exceed $750,000 in any fiscal year, (2) in amounts
necessary to enable Parent to pay taxes when due and owing by it in the ordinary
course of its business as a holding company and (3) in amounts necessary to
enable Parent to pay interest on those certain 11.5% Series A Convertible
Subordinated Notes due June 30, 2008, issued by Parent on June 25, 1993, and (b)
Parent may make Distributions in the form of common stock.
(iv) FIXED CHARGE COVERAGE RATIO. Commencing April
30, 2005, the Company shall not permit the Fixed Charge Coverage Ratio, (a) to
be less than 1.0:1 as of the end of each April, July, October and January (each,
a "FISCAL QUARTER") ending prior to January 1, 2007, and (b) to be less than
1.05:1 as of the last day of each Fiscal Quarter ending thereafter. "FIXED
CHARGE COVERAGE RATIO" means for any period, the ratio of (i) EBITDA for such
period MINUS cash capital expenditures made (to the extent not already incurred
in a prior period) or incurred during such period, to (ii) the sum of (a)
interest expense, (b) principal payments required to be paid during such period
in respect of indebtedness, and (c) all federal, state, and local income taxes
accrued, all as determined for the twelve months ending on the determination
date for the Company and its subsidiaries on a consolidated basis without
duplication and in accordance with generally accepted accounting principles
consistently applied. "EBITDA" means, with respect to any fiscal period, the
Company's and its subsidiaries' consolidated net earnings (or loss), minus
extraordinary gains and interest income, plus interest expense, income taxes,
and depreciation and amortization for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(v) LEVERAGE RATIO. The Company shall not permit the
Leverage Ratio, as determined as of the end of each Fiscal Quarter, to be
greater than the amount set forth in the following table for the Fiscal Quarters
ending in the period set forth opposite thereto:
LEVERAGE RATIO PERIOD
-------------- ------
4.50:1.0 04/30/05 - 10/30/05
4.30:1.0 10/31/05 - 10/30/06
4.00:1.0 10/31/06 - 10/30/07
3.80:1.0 10/31/07 - 10/30/08
"LEVERAGE RATIO" means, at any date of determination, the
ratio of (a) Total Debt at such date to (b) EBITDA for the applicable period
ending on such date. "TOTAL DEBT" means, as of any date of determination,
without duplication, the sum of (a) the outstanding aggregate amount of the
obligations for borrowed money, (b) the outstanding principal amount of capital
leases, (c) the outstanding principal amount of purchase money indebtedness, (d)
the outstanding principal amount of funded debt, and (e) the outstanding
principal amount of all obligations
5
#0873-007
owing to GECC, DVI and USBPS; all as determined for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(vi) EBITDA MARGIN. The Company shall not permit the
EBITDA Margin to be less than 25% as of the end of any Fiscal Quarter ending on
or after April 30, 2005. "EBITDA MARGIN" means for any period, the ratio of (a)
EBITDA for such period, to (b) net revenues (excluding the professional service
fee component of radiology services) for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(vii) RECEIVABLE DAYS. The Company shall not permit
the Receivable Days to exceed 65 days as of the end of any Fiscal Quarter ending
on or after April 30, 2005. "RECEIVABLE DAYS" means for any period, a number
equal to (a) 365 divided by (b) the result of (i) net revenues for such period
divided by (ii) net receivables for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(viii) NAME CHANGES, ETC. The Company agrees that it
shall not change its name or jurisdiction of organization without giving 30 days
prior written notice to USBPS.
10. This paragraph is intentionally left blank.
11. DIS and the Company each represent and warrant that it has
been represented by an attorney of its choice and is fully aware of the terms
contained in this Agreement and AMENDED AND RESTATED RIDER A to which it is a
party which was voluntarily entered into without coercion or duress of any kind.
12. DIS represents and warrants to USBPS on behalf of the
Noteholders and Trustee that all necessary actions on the part of DIS to be
taken in connection with the execution, delivery and performance of this
Agreement have been taken; the performance by DIS of this Agreement and the
AMENDED AND RESTATED RIDER A will not violate any of DIS's Articles of
Incorporation, Articles of Formation, Partnership Agreement or other agreement
or law by which DIS is bound.
6
13. Any notice, request, direction, consent, approval, waiver
or other communication required or permitted under this Agreement to be sent
must be in writing and will become effective only upon delivery to USBPS at the
address set forth herein as follows:
U.S. Bank Portfolio Services
0000 Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxx, XX 00000
Attn: Xxxx Xxx, Director of Operations
14. Except as provided herein, and in the AMENDED AND RESTATED
RIDER A, all of the other provisions of the Loan Documents not restated will
remain in effect.
15. This Agreement and the documents referenced herein
constitute the entire and final agreement among the parties with respect to the
subject matter hereof and there are no agreements, understandings, warranties or
representations among the parties with respect to these matters except as set
forth herein.
16. This Agreement will inure to the benefit of and bind the
parties and their respective successors and permitted assigns.
17. Neither this Agreement nor any of the provisions hereof
can be changed, waived, discharged or terminated except by an instrument in
writing signed by the parties against whom such enforcement of the change,
waiver, discharge or termination is sought.
18. This Agreement will be interpreted and construed under the
laws of the Commonwealth of Pennsylvania, regardless of the domicile of any
party and will be considered to have been made, executed and performed in
Pennsylvania.
19. THE UNDERSIGNED, AND SUBJECT TO THE PROVISIONS CONTAINED
HEREIN, USBPS FOR ITSELF AND AS AGENT FOR THE TRUSTEE, (A) AGREE TO SUBMIT FOR
THEMSELVES, IN ANY LEGAL ACTION OR
7
#0873-007
PROCEEDING RELATING TO THIS AGREEMENT AND ANY SCHEDULE OR FOR RECOGNITION AND
ENFORCEMENT OF ANY JUDGMENT IN RESPECT HEREOF OR THEREOF, TO THE EXCLUSIVE
JURISDICTION OF THE COURTS OF THE COMONWEALTH OF PENNSYLVANIA, THE COURTS OF THE
UNITED STATES OF AMERICA FOR THE EASTERN DISTRICT OF PENNSYLVANIA, AND APPELLATE
COURTS FROM ANY THEREOF, (B) CONSENT THAT ANY ACTION OR PROCEEDING SHALL BE
BROUGHT IN SUCH COURTS, AND WAIVE ANY OBJECTION THAT EACH MAY NOW OR HEREAFTER
HAVE TO THE VENUE OF ANY SUCH ACTION OR PROCEEDING IN ANY SUCH COURT, (C) AGREE
THAT SERVICE OF PROCESS OF ANY SUCH ACTION OR PROCEEDING MAY BE EFFECTED BY
CERTIFIED MAIL (OR ANY SUBSTANTIALLY SIMILAR FORM OF MAIL), POSTAGE PREPAID, TO
THE APPROPRIATE PARTY AT ITS ADDRESS AS SET FORTH HEREIN, AND SERVICE MADE SHALL
BE DEEMED TO BE COMPLETED UPON THE EARLIER OF ACTUAL RECEIPT OR FIVE (5) DAYS
AFTER THE SAME SHALL HAVE BEEN POSTED AS AFORESAID, AND (D) AGREE THAT NOTHING
HEREIN OR IN ANY EXHIBIT OR SCHEDULE SHALL AFFECT THE RIGHT TO EFFECT SERVICE OF
PROCESS IN ANY OTHER MANNER PERMITTED BY LAW. USBPS AND THE UNDERSIGNED EACH
HEREBY UNCONDITIONALLY WAIVES ITS RIGHT TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF
ACTION BASED UPON OR ARISING OUT OF, DIRECTLY OR INDIRECTLY, THIS AGREEMENT, ANY
EXHIBIT AND THE TRANSACTIONS CONTEMPLATED HEREBY AND THEREBY, ANY OF THE RELATED
DOCUMENTS, ANY DEALINGS BETWEEN THE PARTIES HERETO RELATING TO THE SUBJECT
MATTER HEREOF OR THEREOF, AND/OR THE RELATIONSHIP THAT IS BEING
8
#0873-007
ESTABLISHED BETWEEN USBPS AS AGENT FOR THE TRUSTEE AND THE UNDERSIGNED, PROVIDED
USBPS MAY IN ITS DISCRETION ENFORCE THE TERMS OF THE FORUM SELECTION PROVISIONS
IN THE LOANS.
20. DIS and the Company hereby release USBPS, the Trustee, and
the Noteholders from and against any claim, loss, or damage arising out of the
negotiation execution, and performance of the Loan or related matters prior to
the date hereof.
21. This Agreement may be executed in two or more counterparts
and each counterpart shall be deemed an original.
9
LYON FINANCIAL SERVICES, INC. DBA U.S.
BANK PORTFOLIO SERVICES, AS SUCCESSOR
SERVICER FOR DVI RECEIVABLES VIII, L.L.C.
AND AS AGENT FOR U.S. BANK, N.A., AS TRUSTEE
By: ________________________________________
DIAGNOSTIC IMAGING SERVICES, INC. I
By: ________________________________________
RADNET MANAGEMENT, INC.
By: ________________________________________
10
#3230-001
AMENDMENT TO LOAN DOCUMENTS
---------------------------
AGREEMENT made as of June 30, 2004 ("AMENDMENT AGREEMENT" or
"AGREEMENT") by and between LYON FINANCIAL SERVICES, INC. DBA U.S. BANK
PORTFOLIO SERVICES, as Successor Servicer for DVI Receivables XVI, L.L.C. and as
Agent for U.S. Bank, N.A., as Trustee, with offices at 0000 Xxxxxx Xxxxxx, Xxxxx
000, Xxxxxxxx, Xxxxxxxxx 00000 ("USBPS") and Santa Xxxx Imaging, Inc., Xxxxxxx
Radiology Medical Group III, G.P. and Radnet Management, Inc., with offices at
XX Xxx 000000, Xxx Xxxxxxx, XX 00000 (collectively "RADNET"), and such other
signatories hereto.
WHEREAS, on or about September 19, 2001, Radnet executed and
delivered to DVI Financial Services Inc. ("DVI") a Master Loan Agreement
collectively with the Secured Promissory Note Number #3230-001 dated September
19, 2001 (the "LOAN");
WHEREAS, to secure the payment of the Loan and all other
obligations of Radnet to DVI (collectively the "OBLIGATIONS"), Radnet, pursuant
to a Master Security Agreement dated on or about September 19, 2001 (the
"SECURITY AGREEMENT"), granted DVI a first priority security interest in certain
Collateral described therein;
WHEREAS, to further secure payment of the Note and all other
Obligations of Radnet to DVI, Radnet delivered to DVI the guarantee (the
"GUARANTEE") of Primedex Health Systems, Inc. (the "GUARANTOR") (the "GUARANTEE"
together with the Loan and ancillary documents are, collectively the "LOAN
DOCUMENTS");
WHEREAS, substantially contemporaneously therewith, DVI
contributed all of the Loan Documents to DVI Receivables XVI, L.L.C. ("DVI XVI")
and thereafter pursuant to an Amended and Restated Indenture, DVI XVI granted a
first priority security interest in and pledged all of the Loan Documents in
favor of U.S. Bank, N.A., as Trustee, for the benefit of a
#3230-001
noteholder which purchased asset backed promissory notes issued by DVI XVI (the
"NOTEHOLDER");
WHEREAS, DVI contributed other Loans with Radnet or certain
affiliates of Radnet to this and other DVI securitizations (collectively the
"RELATED LOANS");
WHEREAS, Radnet is in default under the terms of the Loan;
WHEREAS, Radnet has requested USBPS to modify the Loan to
reflect an adjustment in payments;
WHEREAS, Radnet and/or certain of its affiliates have agreed
to modify the Related Loans;
WHEREAS, Radnet and certain of its affiliates are engaged in
negotiations to restructure or modify certain loan agreements, loans and
promissory notes with each of General Electric Capital Corporation ("GECC") and
DVI (with respect to GECC, the "GECC MODIFICATION", and with respect to DVI, the
"DVI MODIFICATION");
WHEREAS, subject to the following terms and conditions, USBPS
is willing to modify the Loan as hereinafter provided.
NOW, THEREFORE, the parties agree as follows:
1. All of the Whereas clauses are incorporated herein as if
hereinafter set forth at full length.
2. Radnet acknowledges that it is duly indebted to the Trustee
in the sum set forth on AMENDED AND RESTATED RIDER A annexed hereto, and has no
defenses, counterclaims or offsets to such indebtedness.
3. USBPS as Agent for the Trustee will modify the Loan to
provide for payments to commence in accordance with the attached revised payment
schedule (the
2
#3230-001
"AMENDED AND RESTATED RIDER A"). Radnet may, at any time, prepay all of the
outstanding Obligations subject to an additional prepayment fee of 2% of such
Obligations. Partial prepayments of the Obligations shall not be permitted at
any time.
4. This Agreement shall become effective upon the date that
USBPS receives this Agreement duly executed by Radnet and the satisfaction of
each of the following conditions:
(a) Radnet and/or its affiliates shall have entered
into agreements on similar terms to this Agreement and
otherwise in form and substance satisfactory to USBPS,
relating to the Related Loans (the "RELATED LOAN
MODIFICATIONS");
(b) reimbursement of USBPS's legal fees incurred in
connection with the execution of this Agreement and the
Related Loan Modifications, aggregating $50,000, shall have
been received by USBPS;
(c) Radnet and/or its affiliates shall have entered
into the GECC Modification and the DVI Modification.
5. The closing of the restructuring of the Radnet Loan is
further subject to delivery to USBPS of all of the following, each in form and
substance satisfactory to USBPS and its counsel:
(a) The executed AMENDED AND RESTATED RIDER A;
(b) An executed copy of this Agreement;
(c) Such other documents, including UCC financing
statements as USBPS reasonably requests.
6. Radnet hereby acknowledges and agrees that it has no, and
will not assert any, defenses, counterclaims or offsets to the Loan and AMENDED
AND RESTATED RIDER A and acknowledges and agrees that the Trustee holds a
first-priority security interest in the Collateral.
7. Any default or other breach of any obligation under the
GECC Modification, the DVI Modification, or any of the Related Loan
Modifications shall constitute a
3
#3230-001
default under the Loan as modified by this Agreement, and USBPS shall have all
remedies thereunder.
8. Radnet hereby releases the Noteholder, USBPS individually
and as agent for the Trustee and the special purpose entities for which the
Trustee holds collateral, from and against any claims, loss or damage of any
kind or nature arising out of the Loan.
9. So long as any of the Obligations remain outstanding,
Radnet Management, Inc. (the "COMPANY") agrees as follows:
(i) FINANCIAL REPORTING. The Company shall furnish
the following documents or information to USBPS:
(A) Within 30 days after the end of each
Fiscal Quarter (as defined below) (i) (or 90 days in respect of the last month
of the fiscal year), the Company's consolidated, consolidating and on a center
by center basis, financial statements, including the most recent annual report,
balance sheet (not on a center by center basis) and income statement, prepared
in accordance with generally accepted accounting principles, which reports, the
Company warrants, shall fully and fairly represent the true financial condition
of the Company and (ii) updated projections for the Company and for each center;
(B) any other financial information normally
provided by the Company to the public; and
(C) Such other financial data or information
relative to this Amendment Agreement, including, without limitation, listings of
serial numbers or other identification data and confirmations of such
information, as USBPS may time-to-time reasonably request.
(ii) NO AMENDMENTS. Subsequent to the date of this
Amendment Agreement, the Company will not agree or consent to any amendments or
modifications to any agreement between the Company and DVI, GECC or Xxxxx Fargo
Foothill, Inc. ("FOOTHILL") containing terms (including, but not limited to,
increasing interest rates, accelerating the principal amortization or maturity,
new or more stringent defaults, additional collateral, and new remedies
provisions) that would be more onerous to the Company, or adversely impact or
affect GECC with respect to the terms of this Amendment Agreement.
(iii) DISTRIBUTIONS. The Company shall not make any
distribution or declare or pay any dividends (in cash or other property, other
than common stock) on, or purchase, acquire, redeem, or retire any of the
Company's stock, of any class, whether now or hereafter outstanding
(collectively, "DISTRIBUTIONS"); PROVIDED, HOWEVER, that so long as no
4
#3230-001
default shall have occurred and be continuing immediately prior to or after
giving effect to any such payment, (a) the Company may make Distributions to
Primedex Health Systems, Inc., a New York corporation (the "PARENT") (1) in
amounts necessary to pay customary expenses of Parent in the ordinary course of
its business as a public holding company (including salaries and related
reasonable and customary expenses incurred by employees of Parent) in an
aggregate amount not to exceed $750,000 in any fiscal year, (2) in amounts
necessary to enable Parent to pay taxes when due and owing by it in the ordinary
course of its business as a holding company and (3) in amounts necessary to
enable Parent to pay interest on those certain 11.5% Series A Convertible
Subordinated Notes due June 30, 2008, issued by Parent on June 25, 1993, and (b)
Parent may make Distributions in the form of common stock.
(iv) FIXED CHARGE COVERAGE RATIO. Commencing April
30, 2005, the Company shall not permit the Fixed Charge Coverage Ratio, (a) to
be less than 1.0:1 as of the end of each April, July, October and January (each,
a "FISCAL QUARTER") ending prior to January 1, 2007, and (b) to be less than
1.05:1 as of the last day of each Fiscal Quarter ending thereafter. "FIXED
CHARGE COVERAGE RATIO" means for any period, the ratio of (i) EBITDA for such
period MINUS cash capital expenditures made (to the extent not already incurred
in a prior period) or incurred during such period, to (ii) the sum of (a)
interest expense, (b) principal payments required to be paid during such period
in respect of indebtedness, and (c) all federal, state, and local income taxes
accrued, all as determined for the twelve months ending on the determination
date for the Company and its subsidiaries on a consolidated basis without
duplication and in accordance with generally accepted accounting principles
consistently applied. "EBITDA" means, with respect to any fiscal period, the
Company's and its subsidiaries' consolidated net earnings (or loss), minus
extraordinary gains and interest income, plus interest expense, income taxes,
and depreciation and amortization for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(v) LEVERAGE RATIO. The Company shall not permit the
Leverage Ratio, as determined as of the end of each Fiscal Quarter, to be
greater than the amount set forth in the following table for the Fiscal Quarters
ending in the period set forth opposite thereto:
LEVERAGE RATIO PERIOD
-------------- ------
4.50:1.0 04/30/05 - 10/30/05
4.30:1.0 10/31/05 - 10/30/06
4.00:1.0 10/31/06 - 10/30/07
3.80:1.0 10/31/07 - 10/30/08
"LEVERAGE RATIO" means, at any date of determination, the
ratio of (a) Total Debt at such date to (b) EBITDA for the applicable period
ending on such date. "TOTAL DEBT" means, as of any date of determination,
without duplication, the sum of (a) the outstanding aggregate amount of the
obligations for borrowed money, (b) the outstanding principal amount of capital
leases, (c) the outstanding principal amount of purchase money indebtedness, (d)
the outstanding principal amount of funded debt, and (e) the outstanding
principal amount of all obligations
5
#3230-001 owing to GECC, DVI and USBPS; all as determined for the Company and
its subsidiaries on a consolidated basis without duplication and in accordance
with generally accepted accounting principles consistently applied.
(vi) EBITDA MARGIN. The Company shall not permit the
EBITDA Margin to be less than 25% as of the end of any Fiscal Quarter ending on
or after April 30, 2005. "EBITDA MARGIN" means for any period, the ratio of (a)
EBITDA for such period, to (b) net revenues (excluding the professional service
fee component of radiology services) for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(vii) RECEIVABLE DAYS. The Company shall not permit
the Receivable Days to exceed 65 days as of the end of any Fiscal Quarter ending
on or after April 30, 2005. "RECEIVABLE DAYS" means for any period, a number
equal to (a) 365 divided by (b) the result of (i) net revenues for such period
divided by (ii) net receivables for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(viii) NAME CHANGES, ETC. The Company agrees that it
shall not change its name or jurisdiction of organization without giving 30 days
prior written notice to USBPS.
10. To induce USBPS on behalf of the Trustee to enter this
Agreement, the Guarantor hereby affirms and restates its Guarantee as related to
this Loan and Amended and RESTATED RIDER A.
11. Radnet, the Company and the Guarantor each represent and
warrant that each has been represented by an attorney of its choice and is fully
aware of the terms contained in this Agreement and AMENDED AND RESTATED RIDER A
to which it is a party which was voluntarily entered into without coercion or
duress of any kind.
12. Radnet represents and warrants to USBPS on behalf of the
Noteholders and Trustee that all necessary actions on the part of Radnet to be
taken in connection with the execution, delivery and performance of this
Agreement have been taken; the performance by Radnet of this Agreement and the
AMENDED AND RESTATED RIDER A will not violate any of
6
#3230-001
Radnet's Articles of Incorporation, Articles of Formation, Partnership Agreement
or other agreement or law by which Radnet is bound.
13. Any notice, request, direction, consent, approval, waiver
or other communication required or permitted under this Agreement to be sent
must be in writing and will become effective only upon delivery to USBPS at the
address set forth herein as follows:
U.S. Bank Portfolio Services
0000 Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxx, XX 00000
Attn: Xxxx Xxx, Director of Operations
14. Except as provided herein, and in the AMENDED AND RESTATED
RIDER A, all of the other provisions of the Loan Documents not restated will
remain in effect.
15. This Agreement and the documents referenced herein
constitute the entire and final agreement among the parties with respect to the
subject matter hereof and there are no agreements, understandings, warranties or
representations among the parties with respect to these matters except as set
forth herein.
16. This Agreement will inure to the benefit of and bind the
parties and their respective successors and permitted assigns.
17. Neither this Agreement nor any of the provisions hereof
can be changed, waived, discharged or terminated except by an instrument in
writing signed by the parties against whom such enforcement of the change,
waiver, discharge or termination is sought.
18. This Agreement will be interpreted and construed under the
laws of the Commonwealth of Pennsylvania, regardless of the domicile of any
party and will be considered to have been made, executed and performed in
Pennsylvania.
7
#3230-001
19. THE UNDERSIGNED, AND SUBJECT TO THE PROVISIONS CONTAINED
HEREIN, USBPS FOR ITSELF AND AS AGENT FOR THE TRUSTEE, (A) AGREE TO SUBMIT FOR
THEMSELVES, IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT AND ANY
SCHEDULE OR FOR RECOGNITION AND ENFORCEMENT OF ANY JUDGMENT IN RESPECT HEREOF OR
THEREOF, TO THE EXCLUSIVE JURISDICTION OF THE COURTS OF THE COMONWEALTH OF
PENNSYLVANIA, THE COURTS OF THE UNITED STATES OF AMERICA FOR THE EASTERN
DISTRICT OF PENNSYLVANIA, AND APPELLATE COURTS FROM ANY THEREOF, (B) CONSENT
THAT ANY ACTION OR PROCEEDING SHALL BE BROUGHT IN SUCH COURTS, AND WAIVE ANY
OBJECTION THAT EACH MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH ACTION OR
PROCEEDING IN ANY SUCH COURT, (C) AGREE THAT SERVICE OF PROCESS OF ANY SUCH
ACTION OR PROCEEDING MAY BE EFFECTED BY CERTIFIED MAIL (OR ANY SUBSTANTIALLY
SIMILAR FORM OF MAIL), POSTAGE PREPAID, TO THE APPROPRIATE PARTY AT ITS ADDRESS
AS SET FORTH HEREIN, AND SERVICE MADE SHALL BE DEEMED TO BE COMPLETED UPON THE
EARLIER OF ACTUAL RECEIPT OR FIVE (5) DAYS AFTER THE SAME SHALL HAVE BEEN POSTED
AS AFORESAID, AND (D) AGREE THAT NOTHING HEREIN OR IN ANY EXHIBIT OR SCHEDULE
SHALL AFFECT THE RIGHT TO EFFECT SERVICE OF PROCESS IN ANY OTHER MANNER
PERMITTED BY LAW. USBPS AND THE UNDERSIGNED EACH HEREBY UNCONDITIONALLY WAIVES
ITS RIGHT TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING
OUT OF, DIRECTLY OR INDIRECTLY, THIS AGREEMENT, ANY EXHIBIT AND THE TRANSACTIONS
8
#3230-001
CONTEMPLATED HEREBY AND THEREBY, ANY OF THE RELATED DOCUMENTS, ANY DEALINGS
BETWEEN THE PARTIES HERETO RELATING TO THE SUBJECT MATTER HEREOF OR THEREOF,
AND/OR THE RELATIONSHIP THAT IS BEING ESTABLISHED BETWEEN USBPS AS AGENT FOR THE
TRUSTEE AND THE UNDERSIGNED, PROVIDED USBPS MAY IN ITS DISCRETION ENFORCE THE
TERMS OF THE FORUM SELECTION PROVISIONS IN THE LOANS.
20. Radnet, the Company and the Guarantor hereby release
USBPS, the Trustee, and the Noteholders from and against any claim, loss, or
damage arising out of the negotiation execution, and performance of the Loan or
related matters prior to the date hereof.
21. This Agreement may be executed in two or more counterparts
and each counterpart shall be deemed an original.
9
#3230-001
LYON FINANCIAL SERVICES, INC. DBA U.S. BANK PORTFOLIO
SERVICES, AS SUCCESSOR SERVICER FOR DVI RECEIVABLES XVI,
L.L.C. AND AS AGENT FOR U.S. BANK, N.A., AS TRUSTEE
By:_____________________________________________________
SANTA XXXX IMAGING, INC.
By:_____________________________________________________
XXXXXXX RADIOLOGY MEDICAL GROUP III, G.P.
By:_____________________________________________________
RADNET MANAGEMENT, INC.
By:_____________________________________________________
ACKNOWLEDGED AND AGREED TO:
Primedex Health Systems, Inc., Guarantor
By:_____________________________________
10
#3225-001
AMENDMENT TO LOAN DOCUMENTS
---------------------------
AGREEMENT made as of June 30, 2004 ("AMENDMENT AGREEMENT" or
"AGREEMENT") by and between LYON FINANCIAL SERVICES, INC. DBA U.S. BANK
PORTFOLIO SERVICES, as Successor Servicer for DVI Receivables XVI, L.L.C. and as
Agent for U.S. Bank, N.A., as Trustee, with offices at 0000 Xxxxxx Xxxxxx, Xxxxx
000, Xxxxxxxx, Xxxxxxxxx 00000 ("USBPS") and Imaging Center of La Habra, Inc.,
Xxxxxxx Radiology Medical Group III, G.P. and Radnet Management, Inc., with
offices at XX Xxx 000000, Xxx Xxxxxxx, XX 00000 (collectively "RADNET"), and
such other signatories hereto.
WHEREAS, on or about September 19, 2001, Radnet executed and
delivered to DVI Financial Services Inc. ("DVI") a Master Loan Agreement
collectively with the Secured Promissory Note Number #3225-001 dated September
19, 2001 (the "LOAN");
WHEREAS, to secure the payment of the Loan and all other
obligations of Radnet to DVI (collectively the "OBLIGATIONS"), Radnet, pursuant
to a Master Security Agreement dated on or about September 19, 2001 (the
"SECURITY AGREEMENT"), granted DVI a first priority security interest in certain
Collateral described therein;
WHEREAS, to further secure payment of the Note and all other
Obligations of Radnet to DVI, Radnet delivered to DVI the guarantee (the
"GUARANTEE") of Primedex Health Systems, Inc. (the "GUARANTOR") (the "GUARANTEE"
together with the Loan and ancillary documents are, collectively the "LOAN
DOCUMENTS");
WHEREAS, substantially contemporaneously therewith, DVI
contributed all of the Loan Documents to DVI Receivables XVI, L.L.C. ("DVI XVI")
and thereafter pursuant to an Amended and Restated Indenture, DVI XVI granted a
first priority security interest in and pledged all of the Loan Documents in
favor of U.S. Bank, N.A., as Trustee, for the benefit of a
#3225-001
noteholder which purchased asset backed promissory notes issued by DVI XVI (the
"NOTEHOLDER");
WHEREAS, DVI contributed other Loans with Radnet or certain
affiliates of Radnet to this and other DVI securitizations (collectively the
"RELATED LOANS");
WHEREAS, Radnet is in default under the terms of the Loan;
WHEREAS, Radnet has requested USBPS to modify the Loan to
reflect an adjustment in payments;
WHEREAS, Radnet and/or certain of its affiliates have agreed
to modify the Related Loans;
WHEREAS, Radnet and certain of its affiliates are engaged in
negotiations to restructure or modify certain loan agreements, loans and
promissory notes with each of General Electric Capital Corporation ("GECC") and
DVI (with respect to GECC, the "GECC MODIFICATION", and with respect to DVI, the
"DVI MODIFICATION");
WHEREAS, subject to the following terms and conditions, USBPS
is willing to modify the Loan as hereinafter provided.
NOW, THEREFORE, the parties agree as follows:
1. All of the Whereas clauses are incorporated herein as if
hereinafter set forth at full length.
2. Radnet acknowledges that it is duly indebted to the Trustee
in the sum set forth on AMENDED AND RESTATED RIDER A annexed hereto, and has no
defenses, counterclaims or offsets to such indebtedness.
3. USBPS as Agent for the Trustee will modify the Loan to
provide for payments to commence in accordance with the attached revised payment
schedule (the
2
#3225-001
"AMENDED AND RESTATED RIDER A"). Radnet may, at any time, prepay all of the
outstanding Obligations subject to an additional prepayment fee of 2% of such
Obligations. Partial prepayments of the Obligations shall not be permitted at
any time.
4. This Agreement shall become effective upon the date that
USBPS receives this Agreement duly executed by Radnet and the satisfaction of
each of the following conditions:
(a) Radnet and/or its affiliates shall have entered
into agreements on similar terms to this Agreement and
otherwise in form and substance satisfactory to USBPS,
relating to the Related Loans (the "RELATED LOAN
MODIFICATIONS");
(b) reimbursement of USBPS's legal fees incurred in
connection with the execution of this Agreement and the
Related Loan Modifications, aggregating $50,000, shall have
been received by USBPS;
(c) Radnet and/or its affiliates shall have entered
into the GECC Modification and the DVI Modification.
5. The closing of the restructuring of the Radnet Loan is
further subject to delivery to USBPS of all of the following, each in form and
substance satisfactory to USBPS and its counsel:
(a) The executed AMENDED AND RESTATED RIDER A;
(b) An executed copy of this Agreement;
(c) Such other documents, including UCC financing
statements as USBPS reasonably requests.
6. Radnet hereby acknowledges and agrees that it has no, and
will not assert any, defenses, counterclaims or offsets to the Loan and AMENDED
AND RESTATED RIDER A and acknowledges and agrees that the Trustee holds a
first-priority security interest in the Collateral.
7. Any default or other breach of any obligation under the
GECC Modification, the DVI Modification, or any of the Related Loan
Modifications shall constitute a
3
#3225-001
default under the Loan as modified by this Agreement, and USBPS shall have all
remedies thereunder.
8. Radnet hereby releases the Noteholder, USBPS individually
and as agent for the Trustee and the special purpose entities for which the
Trustee holds collateral, from and against any claims, loss or damage of any
kind or nature arising out of the Loan.
9. So long as any of the Obligations remain outstanding,
Radnet Management, Inc. (the "COMPANY") agrees as follows:
(i) FINANCIAL REPORTING. The Company shall furnish
the following documents or information to USBPS:
(A) Within 30 days after the end of each
Fiscal Quarter (as defined below) (i) (or 90 days in respect of the last month
of the fiscal year), the Company's consolidated, consolidating and on a center
by center basis, financial statements, including the most recent annual report,
balance sheet (not on a center by center basis) and income statement, prepared
in accordance with generally accepted accounting principles, which reports, the
Company warrants, shall fully and fairly represent the true financial condition
of the Company and (ii) updated projections for the Company and for each center;
(B) any other financial information normally
provided by the Company to the public; and
(C) Such other financial data or information
relative to this Amendment Agreement, including, without limitation, listings of
serial numbers or other identification data and confirmations of such
information, as USBPS may time-to-time reasonably request.
(ii) NO AMENDMENTS. Subsequent to the date of this
Amendment Agreement, the Company will not agree or consent to any amendments or
modifications to any agreement between the Company and DVI, GECC or Xxxxx Fargo
Foothill, Inc. ("FOOTHILL") containing terms (including, but not limited to,
increasing interest rates, accelerating the principal amortization or maturity,
new or more stringent defaults, additional collateral, and new remedies
provisions) that would be more onerous to the Company, or adversely impact or
affect GECC with respect to the terms of this Amendment Agreement.
(iii) DISTRIBUTIONS. The Company shall not make any
distribution or declare or pay any dividends (in cash or other property, other
than common stock) on, or purchase, acquire, redeem, or retire any of the
Company's stock, of any class, whether now or hereafter outstanding
(collectively, "DISTRIBUTIONS"); PROVIDED, HOWEVER, that so long as no
4
#3225-001
default shall have occurred and be continuing immediately prior to or after
giving effect to any such payment, (a) the Company may make Distributions to
Primedex Health Systems, Inc., a New York corporation (the "PARENT") (1) in
amounts necessary to pay customary expenses of Parent in the ordinary course of
its business as a public holding company (including salaries and related
reasonable and customary expenses incurred by employees of Parent) in an
aggregate amount not to exceed $750,000 in any fiscal year, (2) in amounts
necessary to enable Parent to pay taxes when due and owing by it in the ordinary
course of its business as a holding company and (3) in amounts necessary to
enable Parent to pay interest on those certain 11.5% Series A Convertible
Subordinated Notes due June 30, 2008, issued by Parent on June 25, 1993, and (b)
Parent may make Distributions in the form of common stock.
(iv) FIXED CHARGE COVERAGE RATIO. Commencing April
30, 2005, the Company shall not permit the Fixed Charge Coverage Ratio, (a) to
be less than 1.0:1 as of the end of each April, July, October and January (each,
a "FISCAL QUARTER") ending prior to January 1, 2007, and (b) to be less than
1.05:1 as of the last day of each Fiscal Quarter ending thereafter. "FIXED
CHARGE COVERAGE RATIO" means for any period, the ratio of (i) EBITDA for such
period MINUS cash capital expenditures made (to the extent not already incurred
in a prior period) or incurred during such period, to (ii) the sum of (a)
interest expense, (b) principal payments required to be paid during such period
in respect of indebtedness, and (c) all federal, state, and local income taxes
accrued, all as determined for the twelve months ending on the determination
date for the Company and its subsidiaries on a consolidated basis without
duplication and in accordance with generally accepted accounting principles
consistently applied. "EBITDA" means, with respect to any fiscal period, the
Company's and its subsidiaries' consolidated net earnings (or loss), minus
extraordinary gains and interest income, plus interest expense, income taxes,
and depreciation and amortization for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(v) LEVERAGE RATIO. The Company shall not permit the
Leverage Ratio, as determined as of the end of each Fiscal Quarter, to be
greater than the amount set forth in the following table for the Fiscal Quarters
ending in the period set forth opposite thereto:
LEVERAGE RATIO PERIOD
-------------- ------
4.50:1.0 04/30/05 - 10/30/05
4.30:1.0 10/31/05 - 10/30/06
4.00:1.0 10/31/06 - 10/30/07
3.80:1.0 10/31/07 - 10/30/08
"LEVERAGE RATIO" means, at any date of determination, the
ratio of (a) Total Debt at such date to (b) EBITDA for the applicable period
ending on such date. "TOTAL DEBT" means, as of any date of determination,
without duplication, the sum of (a) the outstanding aggregate amount of the
obligations for borrowed money, (b) the outstanding principal amount of capital
leases, (c) the outstanding principal amount of purchase money indebtedness, (d)
the outstanding principal amount of funded debt, and (e) the outstanding
principal amount of all obligations
5
#3225-001 owing to GECC, DVI and USBPS; all as determined for the Company and
its subsidiaries on a consolidated basis without duplication and in accordance
with generally accepted accounting principles consistently applied.
(vi) EBITDA MARGIN. The Company shall not permit the
EBITDA Margin to be less than 25% as of the end of any Fiscal Quarter ending on
or after April 30, 2005. "EBITDA MARGIN" means for any period, the ratio of (a)
EBITDA for such period, to (b) net revenues (excluding the professional service
fee component of radiology services) for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(vii) RECEIVABLE DAYS. The Company shall not permit
the Receivable Days to exceed 65 days as of the end of any Fiscal Quarter ending
on or after April 30, 2005. "RECEIVABLE DAYS" means for any period, a number
equal to (a) 365 divided by (b) the result of (i) net revenues for such period
divided by (ii) net receivables for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(viii) NAME CHANGES, ETC. The Company agrees that it
shall not change its name or jurisdiction of organization without giving 30 days
prior written notice to USBPS.
10. To induce USBPS on behalf of the Trustee to enter this
Agreement, the Guarantor hereby affirms and restates its Guarantee as related to
this Loan and AMENDED AND RESTATED RIDER A.
11. Radnet, the Company and the Guarantor each represent and
warrant that each has been represented by an attorney of its choice and is fully
aware of the terms contained in this Agreement and Amended and Restated Rider A
to which it is a party which was voluntarily entered into without coercion or
duress of any kind.
12. Radnet represents and warrants to USBPS on behalf of the
Noteholders and Trustee that all necessary actions on the part of Radnet to be
taken in connection with the execution, delivery and performance of this
Agreement have been taken; the performance by Radnet of this Agreement and the
AMENDED AND RESTATED RIDER A will not violate any of
6
#3225-001
Radnet's Articles of Incorporation, Articles of Formation, Partnership Agreement
or other agreement or law by which Radnet is bound.
13. Any notice, request, direction, consent, approval, waiver
or other communication required or permitted under this Agreement to be sent
must be in writing and will become effective only upon delivery to USBPS at the
address set forth herein as follows:
U.S. Bank Portfolio Services
0000 Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxx, XX 00000
Attn: Xxxx Xxx, Director of Operations
14. Except as provided herein, and in the AMENDED AND RESTATED
RIDER A, all of the other provisions of the Loan Documents not restated will
remain in effect.
15. This Agreement and the documents referenced herein
constitute the entire and final agreement among the parties with respect to the
subject matter hereof and there are no agreements, understandings, warranties or
representations among the parties with respect to these matters except as set
forth herein.
16. This Agreement will inure to the benefit of and bind the
parties and their respective successors and permitted assigns.
17. Neither this Agreement nor any of the provisions hereof
can be changed, waived, discharged or terminated except by an instrument in
writing signed by the parties against whom such enforcement of the change,
waiver, discharge or termination is sought.
18. This Agreement will be interpreted and construed under the
laws of the Commonwealth of Pennsylvania, regardless of the domicile of any
party and will be considered to have been made, executed and performed in
Pennsylvania.
7
#3225-001
19. THE UNDERSIGNED, AND SUBJECT TO THE PROVISIONS CONTAINED
HEREIN, USBPS FOR ITSELF AND AS AGENT FOR THE TRUSTEE, (A) AGREE TO SUBMIT FOR
THEMSELVES, IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT AND ANY
SCHEDULE OR FOR RECOGNITION AND ENFORCEMENT OF ANY JUDGMENT IN RESPECT HEREOF OR
THEREOF, TO THE EXCLUSIVE JURISDICTION OF THE COURTS OF THE COMONWEALTH OF
PENNSYLVANIA, THE COURTS OF THE UNITED STATES OF AMERICA FOR THE EASTERN
DISTRICT OF PENNSYLVANIA, AND APPELLATE COURTS FROM ANY THEREOF, (B) CONSENT
THAT ANY ACTION OR PROCEEDING SHALL BE BROUGHT IN SUCH COURTS, AND WAIVE ANY
OBJECTION THAT EACH MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH ACTION OR
PROCEEDING IN ANY SUCH COURT, (C) AGREE THAT SERVICE OF PROCESS OF ANY SUCH
ACTION OR PROCEEDING MAY BE EFFECTED BY CERTIFIED MAIL (OR ANY SUBSTANTIALLY
SIMILAR FORM OF MAIL), POSTAGE PREPAID, TO THE APPROPRIATE PARTY AT ITS ADDRESS
AS SET FORTH HEREIN, AND SERVICE MADE SHALL BE DEEMED TO BE COMPLETED UPON THE
EARLIER OF ACTUAL RECEIPT OR FIVE (5) DAYS AFTER THE SAME SHALL HAVE BEEN POSTED
AS AFORESAID, AND (D) AGREE THAT NOTHING HEREIN OR IN ANY EXHIBIT OR SCHEDULE
SHALL AFFECT THE RIGHT TO EFFECT SERVICE OF PROCESS IN ANY OTHER MANNER
PERMITTED BY LAW. USBPS AND THE UNDERSIGNED EACH HEREBY UNCONDITIONALLY WAIVES
ITS RIGHT TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING
OUT OF, DIRECTLY OR INDIRECTLY, THIS AGREEMENT, ANY EXHIBIT AND THE TRANSACTIONS
8
#3225-001
CONTEMPLATED HEREBY AND THEREBY, ANY OF THE RELATED DOCUMENTS, ANY DEALINGS
BETWEEN THE PARTIES HERETO RELATING TO THE SUBJECT MATTER HEREOF OR THEREOF,
AND/OR THE RELATIONSHIP THAT IS BEING ESTABLISHED BETWEEN USBPS AS AGENT FOR THE
TRUSTEE AND THE UNDERSIGNED, PROVIDED USBPS MAY IN ITS DISCRETION ENFORCE THE
TERMS OF THE FORUM SELECTION PROVISIONS IN THE LOANS.
20. Radnet, the Company and the Guarantor hereby release
USBPS, the Trustee, and the Noteholders from and against any claim, loss, or
damage arising out of the negotiation execution, and performance of the Loan or
related matters prior to the date hereof.
21. This Agreement may be executed in two or more counterparts
and each counterpart shall be deemed an original.
9
#3225-001
LYON FINANCIAL SERVICES, INC. DBA U.S. BANK PORTFOLIO
SERVICES, AS SUCCESSOR SERVICER FOR DVI RECEIVABLES XVI,
L.L.C. AND AS AGENT FOR U.S. BANK, N.A., AS TRUSTEE
By:_____________________________________________________
IMAGING CENTER OF LA HABRA
By:_____________________________________________________
XXXXXXX RADIOLOGY MEDICAL GROUP III, G.P.
By:_____________________________________________________
RADNET MANAGEMENT, INC.
By:_____________________________________________________
ACKNOWLEDGED AND AGREED TO:
Primedex Health Systems, Inc., Guarantor
By:_____________________________________
10
#3222-001
AMENDMENT TO LOAN DOCUMENTS
---------------------------
AGREEMENT made as of June 30, 2004 ("AMENDMENT AGREEMENT" or
"AGREEMENT") by and between LYON FINANCIAL SERVICES, INC. DBA U.S. BANK
PORTFOLIO SERVICES, as Successor Servicer for DVI Receivables XVI, L.L.C. and as
Agent for U.S. Bank, N.A., as Trustee, with offices at 0000 Xxxxxx Xxxxxx, Xxxxx
000, Xxxxxxxx, Xxxxxxxxx 00000 ("USBPS") and Temecula Valley Imaging, Inc.,
Xxxxxxx Radiology Medical Group III, G.P. and Diagnostic Imaging Services, Inc.,
with offices at 0000 Xxxxxx Xxxxxx, Xxx Xxxxxxx, XX 00000 (collectively "DIS"),
and such other signatories hereto.
WHEREAS, on or about September 19, 2001, DIS executed and
delivered to DVI Financial Services Inc. ("DVI") a Master Loan Agreement
collectively with the Secured Promissory Note Number #3222-001 dated September
19, 2001 (the "LOAN");
WHEREAS, to secure the payment of the Loan and all other
obligations of DIS to DVI (collectively the "OBLIGATIONS"), DIS, pursuant to a
Master Security Agreement dated on or about September 19, 2001 (the "SECURITY
AGREEMENT"), granted DVI a first priority security interest in certain
Collateral described therein;
WHEREAS, to further secure payment of the Note and all other
Obligations of DIS to DVI, DIS delivered to DVI the guarantee (the "GUARANTEE")
of Primedex Health Systems, Inc. (the "GUARANTOR") (the "GUARANTEE" together
with the Loan and ancillary documents are, collectively the "LOAN DOCUMENTS");
WHEREAS, substantially contemporaneously therewith, DVI
contributed all of the Loan Documents to DVI Receivables XVI, L.L.C. ("DVI XVI")
and thereafter pursuant to an Amended and Restated Indenture, DVI XVI granted a
first priority security interest in and pledged all of the Loan Documents in
favor of U.S. Bank, N.A., as Trustee, for the benefit of a
#3222-001
noteholder which purchased asset backed promissory notes issued by DVI XVI (the
"NOTEHOLDER");
WHEREAS, DVI contributed other Loans with DIS or certain
affiliates of DIS to this and other DVI securitizations (collectively the
"RELATED LOANS");
WHEREAS, DIS is in default under the terms of the Loan;
WHEREAS, DIS has requested USBPS to modify the Loan to reflect
an adjustment in payments;
WHEREAS, DIS and/or certain of its affiliates have agreed to
modify the Related Loans;
WHEREAS, DIS and certain of its affiliates are engaged in
negotiations to restructure or modify certain loan agreements, loans and
promissory notes with each of General Electric Capital Corporation ("GECC") and
DVI (with respect to GECC, the "GECC MODIFICATION", and with respect to DVI, the
"DVI MODIFICATION");
WHEREAS, subject to the following terms and conditions, USBPS
is willing to modify the Loan as hereinafter provided.
NOW, THEREFORE, the parties agree as follows:
1. All of the Whereas clauses are incorporated herein as if
hereinafter set forth at full length.
2. DIS acknowledges that it is duly indebted to the Trustee in
the sum set forth on AMENDED AND RESTATED RIDER A annexed hereto, and has no
defenses, counterclaims or offsets to such indebtedness.
3. USBPS as Agent for the Trustee will modify the Loan to
provide for payments to commence in accordance with the attached revised payment
schedule (the
2
#3222-001
"AMENDED AND RESTATED RIDER A"). DIS may, at any time, prepay all of the
outstanding Obligations subject to an additional prepayment fee of 2% of such
Obligations. Partial prepayments of the Obligations shall not be permitted at
any time.
4. This Agreement shall become effective upon the date that
USBPS receives this Agreement duly executed by DIS and the satisfaction of each
of the following conditions:
(a) DIS and/or its affiliates shall have entered into
agreements on similar terms to this Agreement and otherwise in
form and substance satisfactory to USBPS, relating to the
Related Loans (the "RELATED LOAN MODIFICATIONS");
(b) reimbursement of USBPS's legal fees incurred in
connection with the execution of this Agreement and the
Related Loan Modifications, aggregating $50,000, shall have
been received by USBPS;
(c) DIS and/or its affiliates shall have entered into
the GECC Modification and the DVI Modification.
5. The closing of the restructuring of the DIS Loan is further
subject to delivery to USBPS of all of the following, each in form and substance
satisfactory to USBPS and its counsel:
(a) The executed AMENDED AND RESTATED RIDER A;
(b) An executed copy of this Agreement;
(c) Such other documents, including UCC financing
statements as USBPS reasonably requests.
6. DIS hereby acknowledges and agrees that it has no, and will
not assert any, defenses, counterclaims or offsets to the Loan and AMENDED AND
RESTATED RIDER A and acknowledges and agrees that the Trustee holds a
first-priority security interest in the Collateral.
7. Any default or other breach of any obligation under the
GECC Modification, the DVI Modification, or any of the Related Loan
Modifications shall constitute a
3
#3222-001
default under the Loan as modified by this Agreement, and USBPS shall have all
remedies thereunder.
8. DIS hereby releases the Noteholder, USBPS individually and
as agent for the Trustee and the special purpose entities for which the Trustee
holds collateral, from and against any claims, loss or damage of any kind or
nature arising out of the Loan.
9. So long as any of the Obligations remain outstanding,
Radnet Management, Inc. (the "COMPANY") agrees as follows:
(i) FINANCIAL REPORTING. The Company shall furnish
the following documents or information to USBPS:
(A) Within 30 days after the end of each
Fiscal Quarter (as defined below) (i) (or 90 days in respect of the last month
of the fiscal year), the Company's consolidated, consolidating and on a center
by center basis, financial statements, including the most recent annual report,
balance sheet (not on a center by center basis) and income statement, prepared
in accordance with generally accepted accounting principles, which reports, the
Company warrants, shall fully and fairly represent the true financial condition
of the Company and (ii) updated projections for the Company and for each center;
(B) any other financial information normally
provided by the Company to the public; and
(C) Such other financial data or information
relative to this Amendment Agreement, including, without limitation, listings of
serial numbers or other identification data and confirmations of such
information, as USBPS may time-to-time reasonably request.
(ii) NO AMENDMENTS. Subsequent to the date of this
Amendment Agreement, the Company will not agree or consent to any amendments or
modifications to any agreement between the Company and DVI, GECC or Xxxxx Fargo
Foothill, Inc. ("FOOTHILL") containing terms (including, but not limited to,
increasing interest rates, accelerating the principal amortization or maturity,
new or more stringent defaults, additional collateral, and new remedies
provisions) that would be more onerous to the Company, or adversely impact or
affect GECC with respect to the terms of this Amendment Agreement.
(iii) DISTRIBUTIONS. The Company shall not make any
distribution or declare or pay any dividends (in cash or other property, other
than common stock) on, or purchase, acquire, redeem, or retire any of the
Company's stock, of any class, whether now or hereafter outstanding
(collectively, "DISTRIBUTIONS"); PROVIDED, HOWEVER, that so long as no
4
#3222-001
default shall have occurred and be continuing immediately prior to or after
giving effect to any such payment, (a) the Company may make Distributions to
Primedex Health Systems, Inc., a New York corporation (the "PARENT") (1) in
amounts necessary to pay customary expenses of Parent in the ordinary course of
its business as a public holding company (including salaries and related
reasonable and customary expenses incurred by employees of Parent) in an
aggregate amount not to exceed $750,000 in any fiscal year, (2) in amounts
necessary to enable Parent to pay taxes when due and owing by it in the ordinary
course of its business as a holding company and (3) in amounts necessary to
enable Parent to pay interest on those certain 11.5% Series A Convertible
Subordinated Notes due June 30, 2008, issued by Parent on June 25, 1993, and (b)
Parent may make Distributions in the form of common stock.
(iv) FIXED CHARGE COVERAGE RATIO. Commencing April
30, 2005, the Company shall not permit the Fixed Charge Coverage Ratio, (a) to
be less than 1.0:1 as of the end of each April, July, October and January (each,
a "FISCAL QUARTER") ending prior to January 1, 2007, and (b) to be less than
1.05:1 as of the last day of each Fiscal Quarter ending thereafter. "FIXED
CHARGE COVERAGE RATIO" means for any period, the ratio of (i) EBITDA for such
period MINUS cash capital expenditures made (to the extent not already incurred
in a prior period) or incurred during such period, to (ii) the sum of (a)
interest expense, (b) principal payments required to be paid during such period
in respect of indebtedness, and (c) all federal, state, and local income taxes
accrued, all as determined for the twelve months ending on the determination
date for the Company and its subsidiaries on a consolidated basis without
duplication and in accordance with generally accepted accounting principles
consistently applied. "EBITDA" means, with respect to any fiscal period, the
Company's and its subsidiaries' consolidated net earnings (or loss), minus
extraordinary gains and interest income, plus interest expense, income taxes,
and depreciation and amortization for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(v) LEVERAGE RATIO. The Company shall not permit the
Leverage Ratio, as determined as of the end of each Fiscal Quarter, to be
greater than the amount set forth in the following table for the Fiscal Quarters
ending in the period set forth opposite thereto:
LEVERAGE RATIO PERIOD
-------------- ------
4.50:1.0 04/30/05 - 10/30/05
4.30:1.0 10/31/05 - 10/30/06
4.00:1.0 10/31/06 - 10/30/07
3.80:1.0 10/31/07 - 10/30/08
"LEVERAGE RATIO" means, at any date of determination, the
ratio of (a) Total Debt at such date to (b) EBITDA for the applicable period
ending on such date. "TOTAL DEBT" means, as of any date of determination,
without duplication, the sum of (a) the outstanding aggregate amount of the
obligations for borrowed money, (b) the outstanding principal amount of capital
leases, (c) the outstanding principal amount of purchase money indebtedness, (d)
the outstanding principal amount of funded debt, and (e) the outstanding
principal amount of all obligations
5
#3222-001
owing to GECC, DVI and USBPS; all as determined for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(vi) EBITDA MARGIN. The Company shall not permit the
EBITDA Margin to be less than 25% as of the end of any Fiscal Quarter ending on
or after April 30, 2005. "EBITDA MARGIN" means for any period, the ratio of (a)
EBITDA for such period, to (b) net revenues (excluding the professional service
fee component of radiology services) for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(vii) RECEIVABLE DAYS. The Company shall not permit
the Receivable Days to exceed 65 days as of the end of any Fiscal Quarter ending
on or after April 30, 2005. "RECEIVABLE DAYS" means for any period, a number
equal to (a) 365 divided by (b) the result of (i) net revenues for such period
divided by (ii) net receivables for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(viii) NAME CHANGES, ETC. The Company agrees that it
shall not change its name or jurisdiction of organization without giving 30 days
prior written notice to USBPS.
10. To induce USBPS on behalf of the Trustee to enter this
Agreement, the Guarantor hereby affirms and restates its Guarantee as related to
this Loan and AMENDED AND RESTATED RIDER A.
11. DIS, the Company and the Guarantor each represent and
warrant that each has been represented by an attorney of its choice and is fully
aware of the terms contained in this Agreement and AMENDED AND RESTATED RIDER A
to which it is a party which was voluntarily entered into without coercion or
duress of any kind.
12. DIS represents and warrants to USBPS on behalf of the
Noteholders and Trustee that all necessary actions on the part of DIS to be
taken in connection with the execution, delivery and performance of this
Agreement have been taken; the performance by DIS of this Agreement and the
AMENDED AND RESTATED RIDER A will not violate any of DIS's Articles of
6
#3222-001
Incorporation, Articles of Formation, Partnership Agreement or other agreement
or law by which DIS is bound.
13. Any notice, request, direction, consent, approval, waiver
or other communication required or permitted under this Agreement to be sent
must be in writing and will become effective only upon delivery to USBPS at the
address set forth herein as follows:
U.S. Bank Portfolio Services
0000 Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxx, XX 00000
Attn: Xxxx Xxx, Director of Operations
14. Except as provided herein, and in the AMENDED AND RESTATED
RIDER A, all of the other provisions of the Loan Documents not restated will
remain in effect.
15. This Agreement and the documents referenced herein
constitute the entire and final agreement among the parties with respect to the
subject matter hereof and there are no agreements, understandings, warranties or
representations among the parties with respect to these matters except as set
forth herein.
16. This Agreement will inure to the benefit of and bind the
parties and their respective successors and permitted assigns.
17. Neither this Agreement nor any of the provisions hereof
can be changed, waived, discharged or terminated except by an instrument in
writing signed by the parties against whom such enforcement of the change,
waiver, discharge or termination is sought.
18. This Agreement will be interpreted and construed under the
laws of the Commonwealth of Pennsylvania, regardless of the domicile of any
party and will be considered to have been made, executed and performed in
Pennsylvania.
7
#3222-001
19. THE UNDERSIGNED, AND SUBJECT TO THE PROVISIONS CONTAINED
HEREIN, USBPS FOR ITSELF AND AS AGENT FOR THE TRUSTEE, (A) AGREE TO SUBMIT FOR
THEMSELVES, IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT AND ANY
SCHEDULE OR FOR RECOGNITION AND ENFORCEMENT OF ANY JUDGMENT IN RESPECT HEREOF OR
THEREOF, TO THE EXCLUSIVE JURISDICTION OF THE COURTS OF THE COMONWEALTH OF
PENNSYLVANIA, THE COURTS OF THE UNITED STATES OF AMERICA FOR THE EASTERN
DISTRICT OF PENNSYLVANIA, AND APPELLATE COURTS FROM ANY THEREOF, (B) CONSENT
THAT ANY ACTION OR PROCEEDING SHALL BE BROUGHT IN SUCH COURTS, AND WAIVE ANY
OBJECTION THAT EACH MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH ACTION OR
PROCEEDING IN ANY SUCH COURT, (C) AGREE THAT SERVICE OF PROCESS OF ANY SUCH
ACTION OR PROCEEDING MAY BE EFFECTED BY CERTIFIED MAIL (OR ANY SUBSTANTIALLY
SIMILAR FORM OF MAIL), POSTAGE PREPAID, TO THE APPROPRIATE PARTY AT ITS ADDRESS
AS SET FORTH HEREIN, AND SERVICE MADE SHALL BE DEEMED TO BE COMPLETED UPON THE
EARLIER OF ACTUAL RECEIPT OR FIVE (5) DAYS AFTER THE SAME SHALL HAVE BEEN POSTED
AS AFORESAID, AND (D) AGREE THAT NOTHING HEREIN OR IN ANY EXHIBIT OR SCHEDULE
SHALL AFFECT THE RIGHT TO EFFECT SERVICE OF PROCESS IN ANY OTHER MANNER
PERMITTED BY LAW. USBPS AND THE UNDERSIGNED EACH HEREBY UNCONDITIONALLY WAIVES
ITS RIGHT TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING
OUT OF, DIRECTLY OR INDIRECTLY, THIS AGREEMENT, ANY EXHIBIT AND THE TRANSACTIONS
8
#3222-001
CONTEMPLATED HEREBY AND THEREBY, ANY OF THE RELATED DOCUMENTS, ANY DEALINGS
BETWEEN THE PARTIES HERETO RELATING TO THE SUBJECT MATTER HEREOF OR THEREOF,
AND/OR THE RELATIONSHIP THAT IS BEING ESTABLISHED BETWEEN USBPS AS AGENT FOR THE
TRUSTEE AND THE UNDERSIGNED, PROVIDED USBPS MAY IN ITS DISCRETION ENFORCE THE
TERMS OF THE FORUM SELECTION PROVISIONS IN THE LOANS.
20. DIS, the Company and the Guarantor hereby release USBPS,
the Trustee, and the Noteholders from and against any claim, loss, or damage
arising out of the negotiation execution, and performance of the Loan or related
matters prior to the date hereof.
21. This Agreement may be executed in two or more counterparts
and each counterpart shall be deemed an original.
9
#3222-001
LYON FINANCIAL SERVICES, INC. DBA U.S.
BANK PORTFOLIO SERVICES, AS SUCCESSOR
SERVICER FOR DVI RECEIVABLES XVI, L.L.C.
AND AS AGENT FOR U.S. BANK, N.A., AS TRUSTEE
By: ________________________________________
TEMECULA VALLEY IMAGING, INC.
By: ________________________________________
XXXXXXX RADIOLOGY MEDICAL GROUP III, G.P.
By: ________________________________________
DIAGNOSTIC IMAGING SERVICES, INC.
By: ________________________________________
RADNET MANAGEMENT, INC.
By: ________________________________________
ACKNOWLEDGED AND AGREED TO:
Primedex Health Systems, Inc., Guarantor
By:_____________________________________
10
#3218-001
AMENDMENT TO LOAN DOCUMENTS
---------------------------
AGREEMENT made as of June 30, 2004 ("AMENDMENT AGREEMENT" or
"AGREEMENT") by and between LYON FINANCIAL SERVICES, INC. DBA U.S. BANK
PORTFOLIO SERVICES, as Successor Servicer for DVI Receivables XVI, L.L.C. and as
Agent for U.S. Bank, N.A., as Trustee, with offices at 0000 Xxxxxx Xxxxxx, Xxxxx
000, Xxxxxxxx, Xxxxxxxxx 00000 ("USBPS") and Antelope Valley MRI, Inc., Xxxxxxx
Radiology Medical Group III, G.P., Radnet Management, Inc. and Radnet Sub, Inc.,
with offices at XX Xxx 000000, Xxx Xxxxxxx, XX 00000 (collectively "RADNET"),
and such other signatories hereto.
WHEREAS, on or about September 19, 2001, Radnet executed and
delivered to DVI Financial Services Inc. ("DVI") a Master Loan Agreement
collectively with the Secured Promissory Note Number #3218-001 dated September
19, 2001 (the "LOAN");
WHEREAS, to secure the payment of the Loan and all other
obligations of Radnet to DVI (collectively the "OBLIGATIONS"), Radnet, pursuant
to a Master Security Agreement dated on or about September 19, 2001 (the
"SECURITY AGREEMENT"), granted DVI a first priority security interest in certain
Collateral described therein;
WHEREAS, to further secure payment of the Note and all other
Obligations of Radnet to DVI, Radnet delivered to DVI the guarantee (the
"GUARANTEE") of Primedex Health Systems, Inc. (the "GUARANTOR") (the "GUARANTEE"
together with the Loan and ancillary documents are, collectively the "LOAN
DOCUMENTS");
WHEREAS, substantially contemporaneously therewith, DVI
contributed all of the Loan Documents to DVI Receivables XVI, L.L.C. ("DVI XVI")
and thereafter pursuant to an Amended and Restated Indenture, DVI XVI granted a
first priority security interest in and pledged all of the Loan Documents in
favor of U.S. Bank, N.A., as Trustee, for the benefit of a
#3218-001
noteholder which purchased asset backed promissory notes issued by DVI XVI (the
"NOTEHOLDER");
WHEREAS, DVI contributed other Loans with Radnet or certain
affiliates of Radnet to this and other DVI securitizations (collectively the
"RELATED LOANS");
WHEREAS, Radnet is in default under the terms of the Loan;
WHEREAS, Radnet has requested USBPS to modify the Loan to
reflect an adjustment in payments;
WHEREAS, Radnet and/or certain of its affiliates have agreed
to modify the Related Loans;
WHEREAS, Radnet and certain of its affiliates are engaged in
negotiations to restructure or modify certain loan agreements, loans and
promissory notes with each of General Electric Capital Corporation ("GECC") and
DVI (with respect to GECC, the "GECC MODIFICATION", and with respect to DVI, the
"DVI MODIFICATION");
WHEREAS, subject to the following terms and conditions, USBPS
is willing to modify the Loan as hereinafter provided.
NOW, THEREFORE, the parties agree as follows:
1. All of the Whereas clauses are incorporated herein as if
hereinafter set forth at full length.
2. Radnet acknowledges that it is duly indebted to the Trustee
in the sum set forth on AMENDED AND RESTATED RIDER A annexed hereto, and has no
defenses, counterclaims or offsets to such indebtedness.
3. USBPS as Agent for the Trustee will modify the Loan to
provide for payments to commence in accordance with the attached revised payment
schedule (the
2
#3218-001
"AMENDED AND RESTATED RIDER A"). Radnet may, at any time, prepay all of the
outstanding Obligations subject to an additional prepayment fee of 2% of such
Obligations. Partial prepayments of the Obligations shall not be permitted at
any time.
4. This Agreement shall become effective upon the date that
USBPS receives this Agreement duly executed by Radnet and the satisfaction of
each of the following conditions:
(a) Radnet and/or its affiliates shall have entered
into agreements on similar terms to this Agreement and
otherwise in form and substance satisfactory to USBPS,
relating to the Related Loans (the "RELATED LOAN
MODIFICATIONS");
(b) reimbursement of USBPS's legal fees incurred in
connection with the execution of this Agreement and the
Related Loan Modifications, aggregating $50,000, shall have
been received by USBPS;
(c) Radnet and/or its affiliates shall have entered
into the GECC Modification and the DVI Modification.
5. The closing of the restructuring of the Radnet Loan is
further subject to delivery to USBPS of all of the following, each in form and
substance satisfactory to USBPS and its counsel:
(a) The executed AMENDED AND RESTATED RIDER A;
(b) An executed copy of this Agreement;
(c) Such other documents, including UCC financing
statements as USBPS reasonably requests.
6. Radnet hereby acknowledges and agrees that it has no, and
will not assert any, defenses, counterclaims or offsets to the Loan and AMENDED
AND RESTATED RIDER A and acknowledges and agrees that the Trustee holds a
first-priority security interest in the Collateral.
7. Any default or other breach of any obligation under the
GECC Modification, the DVI Modification, or any of the Related Loan
Modifications shall constitute a
3
#3218-001 default under the Loan as modified by this Agreement, and USBPS shall
have all remedies thereunder.
8. Radnet hereby releases the Noteholder, USBPS individually
and as agent for the Trustee and the special purpose entities for which the
Trustee holds collateral, from and against any claims, loss or damage of any
kind or nature arising out of the Loan.
9. So long as any of the Obligations remain outstanding,
Radnet Management, Inc. (the "COMPANY") agrees as follows:
(i) FINANCIAL REPORTING. The Company shall furnish
the following documents or information to USBPS:
(A) Within 30 days after the end of each
Fiscal Quarter (as defined below) (i) (or 90 days in respect of the last month
of the fiscal year), the Company's consolidated, consolidating and on a center
by center basis, financial statements, including the most recent annual report,
balance sheet (not on a center by center basis) and income statement, prepared
in accordance with generally accepted accounting principles, which reports, the
Company warrants, shall fully and fairly represent the true financial condition
of the Company and (ii) updated projections for the Company and for each center;
(B) any other financial information normally
provided by the Company to the public; and
(C) Such other financial data or information
relative to this Amendment Agreement, including, without limitation, listings of
serial numbers or other identification data and confirmations of such
information, as USBPS may time-to-time reasonably request.
(ii) NO AMENDMENTS. Subsequent to the date of this
Amendment Agreement, the Company will not agree or consent to any amendments or
modifications to any agreement between the Company and DVI, GECC or Xxxxx Fargo
Foothill, Inc. ("FOOTHILL") containing terms (including, but not limited to,
increasing interest rates, accelerating the principal amortization or maturity,
new or more stringent defaults, additional collateral, and new remedies
provisions) that would be more onerous to the Company, or adversely impact or
affect GECC with respect to the terms of this Amendment Agreement.
(iii) DISTRIBUTIONS. The Company shall not make any
distribution or declare or pay any dividends (in cash or other property, other
than common stock) on, or purchase, acquire, redeem, or retire any of the
Company's stock, of any class, whether now or hereafter outstanding
(collectively, "DISTRIBUTIONS"); PROVIDED, HOWEVER, that so long as no
4
#3218-001
default shall have occurred and be continuing immediately prior to or after
giving effect to any such payment, (a) the Company may make Distributions to
Primedex Health Systems, Inc., a New York corporation (the "PARENT") (1) in
amounts necessary to pay customary expenses of Parent in the ordinary course of
its business as a public holding company (including salaries and related
reasonable and customary expenses incurred by employees of Parent) in an
aggregate amount not to exceed $750,000 in any fiscal year, (2) in amounts
necessary to enable Parent to pay taxes when due and owing by it in the ordinary
course of its business as a holding company and (3) in amounts necessary to
enable Parent to pay interest on those certain 11.5% Series A Convertible
Subordinated Notes due June 30, 2008, issued by Parent on June 25, 1993, and (b)
Parent may make Distributions in the form of common stock.
(iv) FIXED CHARGE COVERAGE RATIO. Commencing April
30, 2005, the Company shall not permit the Fixed Charge Coverage Ratio, (a) to
be less than 1.0:1 as of the end of each April, July, October and January (each,
a "FISCAL QUARTER") ending prior to January 1, 2007, and (b) to be less than
1.05:1 as of the last day of each Fiscal Quarter ending thereafter. "FIXED
CHARGE COVERAGE RATIO" means for any period, the ratio of (i) EBITDA for such
period MINUS cash capital expenditures made (to the extent not already incurred
in a prior period) or incurred during such period, to (ii) the sum of (a)
interest expense, (b) principal payments required to be paid during such period
in respect of indebtedness, and (c) all federal, state, and local income taxes
accrued, all as determined for the twelve months ending on the determination
date for the Company and its subsidiaries on a consolidated basis without
duplication and in accordance with generally accepted accounting principles
consistently applied. "EBITDA" means, with respect to any fiscal period, the
Company's and its subsidiaries' consolidated net earnings (or loss), minus
extraordinary gains and interest income, plus interest expense, income taxes,
and depreciation and amortization for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(v) LEVERAGE RATIO. The Company shall not permit the
Leverage Ratio, as determined as of the end of each Fiscal Quarter, to be
greater than the amount set forth in the following table for the Fiscal Quarters
ending in the period set forth opposite thereto:
LEVERAGE RATIO PERIOD
-------------- ------
4.50:1.0 04/30/05 - 10/30/05
4.30:1.0 10/31/05 - 10/30/06
4.00:1.0 10/31/06 - 10/30/07
3.80:1.0 10/31/07 - 10/30/08
"LEVERAGE RATIO" means, at any date of determination, the
ratio of (a) Total Debt at such date to (b) EBITDA for the applicable period
ending on such date. "TOTAL DEBT" means, as of any date of determination,
without duplication, the sum of (a) the outstanding aggregate amount of the
obligations for borrowed money, (b) the outstanding principal amount of capital
leases, (c) the outstanding principal amount of purchase money indebtedness, (d)
the outstanding principal amount of funded debt, and (e) the outstanding
principal amount of all obligations
5
#3218-001
owing to GECC, DVI and USBPS; all as determined for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(vi) EBITDA MARGIn. The Company shall not permit the
EBITDA Margin to be less than 25% as of the end of any Fiscal Quarter ending on
or after April 30, 2005. "EBITDA MARGIN" means for any period, the ratio of (a)
EBITDA for such period, to (b) net revenues (excluding the professional service
fee component of radiology services) for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(vii) RECEIVABLE DAYS. The Company shall not permit
the Receivable Days to exceed 65 days as of the end of any Fiscal Quarter ending
on or after April 30, 2005. "RECEIVABLE DAYS" means for any period, a number
equal to (a) 365 divided by (b) the result of (i) net revenues for such period
divided by (ii) net receivables for such period, all as determined for the
twelve months ending on the determination date for the Company and its
subsidiaries on a consolidated basis without duplication and in accordance with
generally accepted accounting principles consistently applied.
(viii) NAME CHANGES, ETC. The Company agrees that it
shall not change its name or jurisdiction of organization without giving 30 days
prior written notice to USBPS.
10. To induce USBPS on behalf of the Trustee to enter this
Agreement, the Guarantor hereby affirms and restates its Guarantee as related to
this Loan and AMENDED AND RESTATED RIDER A.
11. Radnet, the Company and the Guarantor each represent and
warrant that each has been represented by an attorney of its choice and is fully
aware of the terms contained in this Agreement and AMENDED AND RESTATED RIDER A
to which it is a party which was voluntarily entered into without coercion or
duress of any kind.
12. Radnet represents and warrants to USBPS on behalf of the
Noteholders and Trustee that all necessary actions on the part of Radnet to be
taken in connection with the execution, delivery and performance of this
Agreement have been taken; the performance by Radnet of this Agreement and the
AMENDED AND RESTATED RIDER A will not violate any of
6
#3218-001
Radnet's Articles of Incorporation, Articles of Formation, Partnership Agreement
or other agreement or law by which Radnet is bound.
13. Any notice, request, direction, consent, approval, waiver
or other communication required or permitted under this Agreement to be sent
must be in writing and will become effective only upon delivery to USBPS at the
address set forth herein as follows:
U.S. Bank Portfolio Services
0000 Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxx, XX 00000
Attn: Xxxx Xxx, Director of Operations
14. Except as provided herein, and in the AMENDED AND RESTATED
RIDER A, all of the other provisions of the Loan Documents not restated will
remain in effect.
15. This Agreement and the documents referenced herein
constitute the entire and final agreement among the parties with respect to the
subject matter hereof and there are no agreements, understandings, warranties or
representations among the parties with respect to these matters except as set
forth herein.
16. This Agreement will inure to the benefit of and bind the
parties and their respective successors and permitted assigns.
17. Neither this Agreement nor any of the provisions hereof
can be changed, waived, discharged or terminated except by an instrument in
writing signed by the parties against whom such enforcement of the change,
waiver, discharge or termination is sought.
18. This Agreement will be interpreted and construed under the
laws of the Commonwealth of Pennsylvania, regardless of the domicile of any
party and will be considered to have been made, executed and performed in
Pennsylvania.
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19. THE UNDERSIGNED, AND SUBJECT TO THE PROVISIONS CONTAINED
HEREIN, USBPS FOR ITSELF AND AS AGENT FOR THE TRUSTEE, (A) AGREE TO SUBMIT FOR
THEMSELVES, IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT AND ANY
SCHEDULE OR FOR RECOGNITION AND ENFORCEMENT OF ANY JUDGMENT IN RESPECT HEREOF OR
THEREOF, TO THE EXCLUSIVE JURISDICTION OF THE COURTS OF THE COMONWEALTH OF
PENNSYLVANIA, THE COURTS OF THE UNITED STATES OF AMERICA FOR THE EASTERN
DISTRICT OF PENNSYLVANIA, AND APPELLATE COURTS FROM ANY THEREOF, (B) CONSENT
THAT ANY ACTION OR PROCEEDING SHALL BE BROUGHT IN SUCH COURTS, AND WAIVE ANY
OBJECTION THAT EACH MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH ACTION OR
PROCEEDING IN ANY SUCH COURT, (C) AGREE THAT SERVICE OF PROCESS OF ANY SUCH
ACTION OR PROCEEDING MAY BE EFFECTED BY CERTIFIED MAIL (OR ANY SUBSTANTIALLY
SIMILAR FORM OF MAIL), POSTAGE PREPAID, TO THE APPROPRIATE PARTY AT ITS ADDRESS
AS SET FORTH HEREIN, AND SERVICE MADE SHALL BE DEEMED TO BE COMPLETED UPON THE
EARLIER OF ACTUAL RECEIPT OR FIVE (5) DAYS AFTER THE SAME SHALL HAVE BEEN POSTED
AS AFORESAID, AND (D) AGREE THAT NOTHING HEREIN OR IN ANY EXHIBIT OR SCHEDULE
SHALL AFFECT THE RIGHT TO EFFECT SERVICE OF PROCESS IN ANY OTHER MANNER
PERMITTED BY LAW. USBPS AND THE UNDERSIGNED EACH HEREBY UNCONDITIONALLY WAIVES
ITS RIGHT TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING
OUT OF, DIRECTLY OR INDIRECTLY, THIS AGREEMENT, ANY EXHIBIT AND THE TRANSACTIONS
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CONTEMPLATED HEREBY AND THEREBY, ANY OF THE RELATED DOCUMENTS, ANY DEALINGS
BETWEEN THE PARTIES HERETO RELATING TO THE SUBJECT MATTER HEREOF OR THEREOF,
AND/OR THE RELATIONSHIP THAT IS BEING ESTABLISHED BETWEEN USBPS AS AGENT FOR THE
TRUSTEE AND THE UNDERSIGNED, PROVIDED USBPS MAY IN ITS DISCRETION ENFORCE THE
TERMS OF THE FORUM SELECTION PROVISIONS IN THE LOANS.
20. Radnet, the Company and the Guarantor hereby release
USBPS, the Trustee, and the Noteholders from and against any claim, loss, or
damage arising out of the negotiation execution, and performance of the Loan or
related matters prior to the date hereof.
21. This Agreement may be executed in two or more counterparts
and each counterpart shall be deemed an original.
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LYON FINANCIAL SERVICES, INC. DBA U.S.
BANK PORTFOLIO SERVICES, AS SUCCESSOR
SERVICER FOR DVI RECEIVABLES XVI, L.L.C.
AND AS AGENT FOR U.S. BANK, N.A., AS TRUSTEE
By: ________________________________________
ANTELOPE VALLEY MRI
By: ________________________________________
XXXXXXX RADIOLOGY MEDICAL GROUP III, G.P.
By: ________________________________________
RADNET MANAGEMENT, INC.
By: ________________________________________
RADNET SUB, INC.
By: ________________________________________
ACKNOWLEDGED AND AGREED TO:
Primedex Health Systems, Inc., Guarantor
By:_____________________________________
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